Shortly after taking office in January 2025, President Donald Trump issued an executive order to pause foreign aid for 90 days pending review, as part of broader efforts to revise and streamline government expenditure in line with his ‘America First’ policy. The funding freeze shuttered most United States Agency for International Development (USAID) programmes worldwide. While the Department of State (DoS) issued a waiver for life-saving aid, and efforts to dismantle USAID have been temporarily paused due to legal challenges, the decision signals the administration’s intent to significantly reduce spending in this area.

Fragile states, fading support

Foreign aid has long been criticised for its ineffectiveness in addressing the issues it aims to resolve. While calls for reform have been made both in the US and abroad, the sudden cuts have caught recipient countries and USAID contractors off guard. The US is not alone in scaling back aid, as European countries such as the UK, France, and Germany have also reduced their contributions in recent years. However, due to the scale of USAID disbursements and the global reliance on them—a source of frustration for the new administration—the loss of funding will have a greater impact on those most dependent.

Since 1961, USAID has provided civilian foreign aid and development assistance to over 150 countries, disbursing USD 43.8 billion out of the USD 72 billion US foreign aid budget in the 2023 fiscal year. For decades, USAID has played a key role in coordinating international responses to humanitarian crises worldwide. Ukraine remains the largest recipient of USAID, receiving over USD 16 billion the 2023 financial year, while countries such as Ethiopia, Somalia, Afghanistan, Syria, Yemen, and the Democratic Republic of Congo (DRC) each receive between USD 700 million and USD 1.4 billion per year.

Ukraine

While Ukraine remains heavily reliant on US military aid, the USD 30 billion in support through USAID it has received over the three-year war has been crucial in sustaining its economy and institutions. USAID cuts will not directly affect US military support; however, economic assistance has enabled the government to maintain services like healthcare and education, and pay public sector salaries. Consequently, the government will need to secure alternative funding sources to maintain administrative functions and failure to do so could hinder efforts to restore institutional capacity.

Even if a ceasefire is reached between Russia and Ukraine in the coming months, Ukraine’s economy – already devastated amid widespread infrastructure damage, the loss of agricultural land, and the occupation of 20 percent of its mineral-rich, industrial east – will require significant external support to recover. Aid has also supported the struggling private sector, including providing fertilisers and supplies to farmers. The loss of US financial backing would be felt in efforts to rejuvenate Ukraine’s critical agricultural sector, and rebuild damaged energy, rail and other infrastructure essential for attracting and retaining foreign investment.

Ethiopia

Ethiopia – the third largest recipient of USAID support which accounted for over 20 percent of its total development assistance in 2023 – remains heavily reliant on humanitarian aid to combat food insecurity stemming from ongoing conflict. The loss of aid to the Tigray, Amhara, and Afar regions, will intensify resource competition and strain existing governance structures, as aid organisations have been able to reach areas where government capacity is limited. This reduction in external support will likely exacerbate communal and ethnic tensions, particularly in conflict-prone areas where resources are already scarce.

During the 2020 – 2022 Tigray conflict, both government forces and the rebel Tigrayan People's Liberation Front (TPLF) weaponised food insecurity by diverting aid to supportive communities, while depriving adversaries. Dynamics that increase resource competitions have the potential to play into the ongoing conflict in the Amhara region if leveraged similarly by government forces or opposing Amhara FANO militias.

Additionally, USAID has invested millions in the Sustainable Peace Activity (SPA), which the agency established to bolster peacebuilding initiatives, and support emergency response capabilities throughout the country. The SPA has a five year mandate and since its inception in 2024 has concentrated its efforts in the Tigray Region; however, losing this support could undermine conflict-affected communities' resilience and weaken mediation efforts, potentially prolonging instability in the areas it serves.

Haiti

USAID has provided extensive support in Haiti, which continues to face a severe humanitarian crisis due to ongoing political instability and gang violence. While long-standing concerns exist about the effectiveness of foreign aid in Haiti and the dependency it has fostered, a sudden reduction in aid is expected to have a significant short- to medium-term impact.

Disruptions to healthcare programmes and food assistance – critical in a country where 50 percent of the population faces food insecurity, as well as severe cholera outbreaks – will further challenge the government’s already strained capacity. Additionally, a reduction in overall US support (including USD 50 million from the DoS allocated to peace and security efforts, some of which has been frozen) will likely also affect multilateral efforts to counter Haiti’s entrenched gangs largely responsible for the country’s widespread security crisis. Since its deployment in 2023, the Kenyan-led Multinational Security Support (MSS) Mission in Haiti, tasked with strengthening the Haitian National Police, has faced chronic funding shortages. The US had earmarked over USD 13 million for the MSS, but this funding has been frozen at a time when the force urgently requires financial support for training, salary payments and other expenses.

Without the MSS, Haitian security forces are unlikely to counter the gangs on their own, and worsening violence could frustrate the interim government’s ambition to hold elections in November 2025. Uncertainty around the US’s continued commitment to supporting Haiti drives concern not only over the MSS’s future, but also about longer-term efforts to tackle Haiti’s severe security, political and humanitarian crises.