Donald Trump’s foreign aid freeze sparks global funding crisis

With Colombian anti-narcotrafficking helicopters idle for want of fuel and news outlets in Ukraine threatened by closure, aid organisations and governments around the world are frantically trying to understand how the abrupt freeze of US foreign aid will affect their activities.

The 90-day suspension of US aid and “stop-work” requirement following the president’s executive order last week has exposed with lightning-like intensity the global reach of US assistance, whose diverse projects worldwide have been an essential part of American soft power.

The new stance on foreign assistance could threaten that goodwill by putting countries on notice that there was no longer a “distinction between allies, partners and enemies”, said Gyude Moore, a former Liberian public works minister and fellow at the Center for Global Development, a Washington think-tank. “It crystallises this idea that any engagement with the US is transactional.”

After a global outcry, Marco Rubio, US secretary of state, clarified on Tuesday that “core life-saving programmes” related to medicine, food and shelter would be exempt from the suspension. Still, humanitarian organisations around the world were left trying to figure out how they would be affected. Yet more international programmes were threatened by Trump’s shortlived federal budget suspension, which was scrapped on Wednesday.

“We are encouraged to hear that there is a waiver process for life saving programmes, but remain concerned that this could get caught up in bureaucratic red tape,” said Elizabeth Hoffman, North America executive director at One, an organisation that campaigns for financing and debt relief for poor countries.

HIV testing in Mozambique. The US President’s Emergency Plan for Aids Relief has invested more than $110bn in HIV treatment since 2003 © Minako Sasako/The Yomiuri Shimbun/Reuters

Beatriz Grinsztejn, International Aids Society president, highlighted the threat to the US-backed President’s Emergency Plan for Aids Relief, which has invested more than $110bn in HIV treatment since 2003 and is credited with saving millions of lives in Africa and elsewhere. “PEPFAR provides life-saving antiretrovirals for more than 20mn people,” she said. If funding is cut, “people are going to die and HIV will resurge”.

Trump’s executive order questioned the rationale of much US assistance, which amounted to $64.7bn in 2023, according to ONE, more than a quarter of the $223bn provided by rich countries in that year.

According to Trump’s executive order, much US spending was “antithetical to American values”. Tammy Bruce, a state department spokeswoman, said the US was “no longer going to blindly dole out money with no return for the American people”.

The threat of abrupt withdrawal of swaths of US aid, even once the temporary ban is lifted, has also underlined the historic difference between Washington’s assistance, with its emphasis on grants for health, development and human rights, and that of Beijing, whose main focus has been on loans for Chinese-built infrastructure.

“We rely heavily on the US for our funding and it is a very big headache,” said an adviser to the government in Sierra Leone in west Africa, where US-funded Mpox monitoring and HIV testing immediately stopped following Trump’s executive order.

“The best-case scenario is to get funding elsewhere,” said the adviser, part of whose salary is paid for by US aid, but indicated that China is unlikely to step fully into the breach.

Among the programmes immediately threatened, said officials, were relief efforts in Sudan, where nearly two years of civil war has unleashed arguably the world’s worst humanitarian catastrophe, with about half the 49mn population on the verge of famine.

Amjed Farid, a former special adviser to the civilian government, said vital communal kitchens relied exclusively on donor support.

“The freeze on US funding now threatens to leave millions of Sudanese vulnerable to further suffering, starvation, and inadequate medical care,” he said, although it was unclear whether Rubio’s waiver might save such programmes.

In Ukraine, the world’s biggest recipient of international assistance since the start of Russia’s invasion in February 2022, USAID has provided $2.6bn in humanitarian aid, $5bn in development assistance and more than $30bn in direct budget support.

USAID administror Samantha Power presenting books for a school in Kyiv during the delivery of aid to Ukraine in October 2024
Since Russia invaded Ukraine, USAID has provided $2.6bn in humanitarian aid, $5bn in development assistance and more than $30bn in direct budget support to Ukraine © Alina Smutko/Reuters

Although President Volodymyr Zelenskyy confirmed that US military assistance had not been stopped, dozens of Ukrainian entities, including news outlets, medical facilities and veterans organisations, have reported receiving “stop work” orders.

Mediarukh, a coalition of news outlets and watchdogs, said in a statement that the freeze would have an impact on the country’s information space, which Russia has exploited during its war. “Independent Ukrainian media is one of the key elements that distinguishes us from [Vladimir] Putin’s Russia,” it said.

Colombia, which was due to receive about $380mn this year in development and counternarcotics funding, has been hit by the spending freeze.

The country has hosted around 2.8mn Venezuelan migrants, according to the International Organization for Migration, with many NGOs that provide shelter, food, and orientation now unable to pay for their operations.

“All project activities associated with these sources of funding have been suspended,” said an international NGO worker.

Even several Colombian police operations financed by the Bureau of International Narcotics and Law Enforcement Affairs were put on ice during Trump’s separate federal budget suspension, which was later dropped. “Narcotics, wildlife trafficking, flora trafficking, illegal mining, hydrocarbons, everything [was] affected,” said the official.

Aid officials sought to present their programmes — whether in early-warning systems for the next pandemic or countering terrorism through youth projects — as contributing to US security in line with Trump’s new “America first” policy.

“PEPFAR is not just a global health programme, it’s a cornerstone of US national security, protecting Americans from emerging health threats,” said Hoffman of the One Campaign. “Our adversaries will capitalise on this gap in US leadership and promote disinformation which will undermine trust in the US and damage our reputation around the world.”

In Afghanistan, where the US is the largest humanitarian donor, the cuts threatened help for the women who have been erased from public life since the Taliban took over, especially young girls who still have some access to primary education.

Local residents carry boxes and sacks of food distributed by USAID in Kachoda, Kenya in July 2022
Local residents carry food distributed by USAID in Kenya. Many NGOs that provide shelter, food, and orientation are now unable to pay for their operations © Desmond Tiro/AP

In the long run, more threatened still may be programmes seen to run counter to Trump’s orders to “end ‘wokeness’” and to stop the use of US taxpayer money to fund what the Office of Management and Budget called “Marxist equity, transgenderism and green new deal social engineering”.

In Lebanon, Bechara Samneh, a board member at Mosaic, which provides psychosocial support to LGBT+ people — among the few active organisations providing such a service — said it had long relied on foreign donors because of local unwillingness to fund the group.

During the recent war, Mosaic provided shelter and emergency services for 400 displaced LGBT+ people. “What does it mean for the LGBTQI+ community on the ground?” Samneh said. “It means no services, no support, no emergency, no protection.”

Still, some policy advocates argued that, however unwelcome the prospective cuts were, they served as a reminder that many health and welfare systems overly depended on foreign aid.

“Our governments now know that help is coming from nowhere,” said Ayoade Alakija, a global health specialist from Nigeria. “They need to start funding things themselves and investing in their own health and education.”

Additional reporting by Andres Schipani in New Delhi and Malaika Kanaaneh Tapper in Beirut

Data visualisation by Clara Murray


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