Khaberni - A responsible source stated that recent discussions claiming that Jafar Hassan's government has the highest borrowing are inaccurate, and clarified that Ministry of Finance data shows that public debt has increased by about 2.7 billion dinars to reach 46.8 billion dinars.
The source also clarified that an objective reading of the figures shows that about 58% of the debt increase, which amounts to about 1.5 billion dinars, represents interest payments on the accumulated public debt from previous years, including settling financial obligations that amount to arrears exceeding 100 million dinars, and tax reimbursements that the government has paid for previous periods.
Furthermore, the source explained that the IMF’s methodology for assessing government financial performance excludes interest payments.
The remaining part of the debt increase, amounting to 1.1 billion dinars, includes 212 million dinars obtained through a concessional loan with low interest rates leading to a temporary increase in the debt balance, which will be used to repay part of the Eurobonds due in January 2026, amounting to about 710 million dinars. Thus, the government has borrowed only about 900 million dinars to cover the deficit, confirming that part of this borrowing was for financing capital expenditures, which is a commendable economic practice from a long-term perspective.
The source noted that the government is committed to implementing the provisions of the Public Budget Law, which estimates the fiscal deficit at about 2.3 billion dinars for the year 2025, in addition to the deficits of both the National Electric Power Company and the Water Authority, which total about 820 million dinars. It indicated that the government has worked on a qualitative transformation in debt management policy focusing on cost and sustainability and seeking new and unique solutions for managing public debt. This has resulted in reducing the cost of debt servicing on Eurobonds during the first half of the year due in early June 2025 by 40%, saving about 40 million dollars annually on the budget. This was achieved by replacing part of the international bonds with concessional financings and low-interest Islamic bonds, benefiting from the liquidity available in Islamic banks and cooperation with Arab and international financing institutions.
The source mentioned that the latest agreement at the expert level between the government and the IMF during the fourth review under the Extended Fund Facility (EFF) and the first review under the Resilience and Sustainability Facility (RSF) issued in October 2025 indicated that the government is committed to steadily reducing the public debt path, through gradual rectification of public financial conditions while protecting priority social and developmental spending. It expressed confidence in the continued sustainability of public debt in the kingdom, despite its increase in absolute terms, and the government's ability to fulfill its various commitments, as this is the fundamental standard for judging debt sustainability.
The source confirmed that the government is committed to reducing the debt path and reaching a rate of 80% of GDP by 2028, meaning that the public budget in detail is a translation of consensus within the framework of the correction program, and this path is a safe trajectory ensuring the debt reaches its targeted level by 2028.
The source also confirmed that evaluating the government's performance must take into account the performance of other macroeconomic indicators, which have shown positive results driven by a series of economic stimulus decisions exceeding 162 measures so far, resulting in many positive economic indicators. Foremost among these is the economic growth rate, which grew by 2.8% during the second quarter of 2025, the highest growth rate recorded since the outbreak of the Gaza war, driven by the recovery of the tourism sector, which grew by 7.5% over the past eight months, growth in national exports by 8.0%, growth in foreign investment by 36.6% during the first half, and reaching unprecedented levels of foreign reserves at the central bank amounting to 24 billion dollars, reflecting the soundness of the applied economic policies and the positive impact of the government's measures.
