The Global Fallout of USAID’s Closure
USAID has been a critical part of the global aid architecture
Donald Trump has been President of the United States for less than a month. But it feels like a lot longer. An awful lot has happened.
Among the highlights of his—and his billionaire lieutenant (or is it boss?) Elon Musk’s—early exploits are their assault on U.S. Federal agencies, most notably on the U.S. Agency for International Development (USAID), one of the largest development aid agencies in the world.
Trump and Musk have levelled several accusations against the aid agency, all without any evidence.
Their remarks have been as untrue as they have been bizarre. Trump declared that USAID had “been run by a bunch of radical lunatics, and we’re getting them out.”
Musk, who is officially a “special government employee,” has said that USAID is a “criminal organization” and that it is “time for it to die.” As yet, no evidence of this has emerged.
One of the strangest allegations they have promoted is the claim that USAID used taxpayer funds to buy condoms for Hamas. This conspiracy theory has been widely debunked. When Musk was confronted about it during an unusual Oval Office appearance last week, he admitted the mistake: "Some of the things that I say will be incorrect and should be corrected."
Yet, the assault on USAID, and other federal agencies, has continued unabated.
There was a lot that was wrong with the USAID and a lot needed fixing. But the manner in which Trump and Musk have chosen to handle it feels like a classic case of throwing the baby out with the bathwater. It will, as one public health professional put it, “kill people.”
What is USAID?
Established in 1961 by President John F. Kennedy, USAID has since become one of the largest development aid agencies in the world. As of January 2025, it was running projects in 120 countries, focusing on poverty alleviation, education, vaccination programs, epidemic response, clean water access, and other critical development efforts.
In 2023, the U.S. government spent $64 billion on international aid, with USAID accounting for $40 billion of that amount. While this represents a significant share of American foreign assistance, it constitutes just 0.6% of the total federal budget—meaning that cutting it will do little to address budget concerns but could have devastating consequences for millions worldwide.
The Global Impact of Shutting Down USAID
Data shows that eliminating USAID will create a massive void in global development aid. Here’s how:
The U.S. is the largest source of official development aid
OECD data shows that the U.S. government is the single biggest provider of foreign aid, with USAID responsible for about 60% of that assistance.
Without USAID, global development efforts will lose one of their biggest financial backers, leaving other donor nations scrambling to fill the gap.
The poorest countries will suffer the most
According to the Center for Global Development, in several of the world’s lowest-income nations, USAID accounted for more than 20% of total foreign aid.
The sudden freeze in funding could result in a shortfall equal to 3% of these nations’ gross national incomes—enough to significantly impact economic stability and development progress.
Critical health programs are at risk
USAID has been a key player in global health initiatives, funding programs that combat HIV/AIDS, tuberculosis, malaria, and other diseases.
Cutting these programs could reverse years of progress, leading to increased mortality rates and worsening public health crises in vulnerable regions.
What next for USAID?
As with all things Trump and Musk, it is unclear.
There is a pause of at least 90 days on development assistance to foreign countries, NGOs and international organisations. What happens after this period is unclear, with several pending legal challenges that could alter the outcome.
What is certain, however, is that under Trump and Musk, the U.S. will cede ground in international development aid. This will create a significant gap in global funding, leaving millions vulnerable. At the same time, it presents an opportunity for other nations, private donors, and international organizations to step up and redefine the global aid landscape.
In other news
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