After pausing all USAID contracts and grants shortly after Donald Trumps’ inauguration, the administration issued termination notices for 83% of the agencies’ programming around the world on March 10. In a post on X, Secretary of State Marco Rubio noted that the State Department would administer the remaining awards, effectively dismantling USAID, which the U.S. Congress established under the John F. Kennedy administration in 1961. The administration has provided further updates on the future of U.S. government (USG) foreign assistance, noting in an internal briefing paper in mid-March that a newly established U.S. Agency for International Humanitarian Assistance (USIHA) would replace USAID and operate with a more limited mandate. In addition, on March 28, acting Deputy Administrator and Department of Government Efficiency (DOGE) appointee Jeremy Lewin circulated an internal memo confirming that as part of the transition of remaining USAID programming under the State Department, “all non-statutory positions at USAID will be eliminated.” The memo also stated that staff will receive Reduction-In-Force notices via email between July 1 and September 2, thus terminating the remainder of the six-decade-old agency’s workforce. 

Immediate and Long-Term Effects on Beneficiaries

The dramatic cuts in aid sent shock waves throughout the international development and humanitarian industry and have had serious repercussions on beneficiaries. An internal USAID memo made public in March projected that cuts to the agency would result in immense human suffering, including an additional 200,000 children paralyzed with polio, up to 18 million additional cases of malaria, and 33,000 tuberculosis-related deaths each year. In addition, the sudden reduction in aid has also had an immediate impact on some of the most vulnerable in countries like South Sudan, where the pause on PEPFAR funding has already led to confirmed AIDS-related deaths. PEPFAR is a global initiative established under the Bush administration to prevent the spread of HIV, and has saved an estimated 26 million lives so far. The pause on global health programming has also led to an Ebola outbreak in Uganda that was responsible for at least 14 deaths. While the administration temporarily allowed PEPFAR programming to restart, its future remains in jeopardy due to Republican concerns about implementing partners’ support for abortion rights. The deadly impact of a brief pause in these initiatives provides a glimpse of just how devastating a drawdown in US foreign development and humanitarian assistance could be.

The impact goes beyond support during protracted crises, including a lack of immediate response to disasters such as the recent 7.7 magnitude earthquake in Myanmar. On March 30, the U.S. Embassy in Myanmar announced that the U.S. will provide $2 million for humanitarian assistance to local organizations, but a former senior USAID Bureau for Humanitarian Assistance (BHA) official has noted that the government’s capacity to implement programming is “severely diminished.” The funding obligation stands in stark contrast with the Biden Administration’s response to the 7.8 magnitude earthquake that rocked Türkiye and the northern Syrian border, which included a rapid mobilization of BHA Disaster Assistance Response Teams (DART) and a total of $185 million in humanitarian assistance. Given that the US has provided up to 47% of the world’s global humanitarian assistance, the impact on vulnerable communities is guaranteed to grow over the coming months and years. 

Impact on Staff

The funding cuts have caused significant job loss for both international and national staff across the development and humanitarian sectors. The number of USAID staff alone decreased from 10,000 to around 600 staff, a 94% reduction of its total workforce, including staff based outside of the US who were forced to abruptly repatriate with their families. In some instances staff were left stranded in conflict-affected countries like the DRC, where foreign service officers and their families received no evacuation support as their homes were raided during the recent escalation in fighting between the Congolese security forces and M23 rebels. 

The cancellation of awards and uncertainty around future programming has also had a devastating impact on the workforce at implementing partners (IP), with an estimated 50,000 U.S.-based and 170,000 international jobs lost and some IPs already going out of business. Top USAID contractors including Chemonics and DAI have laid of hundreds of staff, and many of the world’s largest international NGOs like IRC and Save the Children have laid off and furloughed thousands of their global workforce. These mass layoffs have left hundreds of thousands of aid workers around the world without an income, and little hope of finding future employment in a rapidly declining foreign aid industry. 

Global Reduction in Humanitarian and Development Assistance

The sudden decrease in USG cash flow has had a sizable impact on the global humanitarian system, including within the United Nations. Since the UN’s founding in 1945, the U.S. has been the multilateral organization’s largest donor, accounting for more than 25% of its total budget at nearly $13 billion in 2023. USAID in particular provided a substantial portion of funding for many UN humanitarian agencies like the World Food Programme (WFP) at over 50% and the International Organization on Migration (IOM) at 40%. As a result, WFP has reduced food rations by half for Rohingya refugees and the IOM has laid off roughly 3,000 staff. 

European donors have followed suit and are beginning to slash their aid budgets to prioritize domestic interests and defence funding to increase their support for Ukraine. Most notably, the Netherlands decreased its international development and humanitarian budget by 30%, the French reduced their spending on aid by 37%, and the UK slashed its foreign assistance by 40% to “fight for peace in Europe.” The German government is also considering cutting its foreign aid budget and integrating its federal development agency into the Foreign Ministry to better align its development programs with Germany’s broader foreign policy, much like the Trump administration’s move to wrap foreign assistance under the purview of the State Department. The dismantling of USAID has set a precedent for a global reduction in foreign assistance, the repercussions of which are only beginning to emerge.