By On March 10, Secretary of State Marco Rubio announced the cancellation of 83 percent of USAID programs. According to the Trump administration, canceling 5200 contracts will save American taxpayers tens of billions of dollars. However, it’s not yet clear how saving just 1 percent of the federal budget by canceling the world’s largest soft power asset will serve American interests. It seems an ill-considered move in a world where there is huge competition for influence in third countries with powers like China and Russia.
What Has Made USAID a Significant Player the International Relations
The United States Agency for International Development (USAID) was established in 1961 by President John F. Kennedy. The U.S. government agency is responsible for administering foreign aid and development assistance. Its goal is to promote global stability, economic development, and improved living standards. USAID addresses challenges such as poverty, hunger, health crises, and education in developing countries. It promotes democratic governance, improves education, provides humanitarian assistance during disasters, and encourages sustainable economic growth. It is often involved in both long-term development projects and emergency relief efforts.
Programs supported by USAID range from weather disaster forecasting (e.g., hurricanes, tsunamis), malnutrition and nutrition programs, global child vaccination programs, medical research, or programs to prevent the spread of viruses or epidemics (e.g., Ebola). Together, these activities have been proven to save hundreds of thousands of lives alone in recent years.
USAID has played a significant role in foreign policy since its inception. It was created as an independent agency to counter the influence of the Soviet Union during the Cold War. Another important goal was to manage various foreign aid programs based on the idea that American security is linked to other nations’ stability and economic development. Since then, foreign aid has been widely seen as a cornerstone of soft power.
Both Republicans and Democrats have supported USAID for decades. From the American point of view, its importance could hardly have been questioned, as it has maintained a pro-American world in many countries. Since 2000, USAID spending has grown from nearly $7 billion to $43 billion annually, making the United States the largest international donor. Interestingly, Donald Trump himself increased spending by 50 percent during his first term.
15 countries spend the most on development aid (Source: OECD, nzz.ch)
Although critics noted after the second Trump cabinet inauguration that the agency supported several left-wing ideological programs, even under President Joe Biden, the promotion of democracy, education, and the environment remained marginal.
However, the cancer of fake news – mostly spread by the Trump administration – was unstoppable, and the decision was taken to abolish the agency, and the office, which employed over 10,000 people, will be reduced to 290 and merged into the State Department.
Most importantly, the sudden termination of the agency’s programs will result not only in the loss of the United States’ most important soft power asset but also incalculable loss of trust in the United States among over 100 countries.
Can the Disappearance of USAID Positively Impact Third Countries?
Many have criticized the international aid system in recent decades, not only on the donor side but also on the recipient side. Dambisa Moyo published her book “Dead Aid” in 2009, which discusses the failure of the foreign aid system and its negative effects on Africa. The Zambian economist argues that aid has failed to promote economic growth, reduce poverty, and foster self-sufficiency. Instead, she claims that aid has created dependency, encouraged corruption, and stifled local entrepreneurship.
Not only has there been no recovery in economic development, but countries that rely heavily on aid remain poor and stagnant. In her book, Moyo also states that the large influx of money with little oversight often fuels government corruption as leaders use the funds for personal gain rather than development.
Finally, she argues that continued aid discourages governments from developing sustainable economic policies and relying on external funds, leading to economic dependency.
In her book, Moyo calls for a gradual reduction of aid and urges African countries to focus on free markets, good governance, and self-sufficiency. Because she believes that with the right policies, Africa can achieve sustainable economic growth. However, not much has happened in the last 15 years, except that China’s approach to trade and investment in Africa has become significant, helping to diversify its foreign presence in African countries.
Ghana’s former president, Nana Akufo-Addo, launched the “Ghana beyond aid” policy in 2017 to reduce his country’s dependence on Western aid. Although his mission failed, leading Ghana into default and its 17th IMF bailout, many African leaders say it is time to become more self-reliant. With the destruction of USAID, they seem to have a great chance to become more independent. Not least because other partners, such as the United Kingdom, have also announced that they will cut a significant part of their aid budget to spend it on the country’s military defense.
Other Western partners, such as France, cut their aid by a third last year, while Germany, the second largest donor in the world, cut aid and development assistance by $5.3 billion over the past three years.
The list with the Netherlands and other smaller partners is long and cannot be said to have started with USAID. Still, significant changes are becoming visible with the American decision.
Lowest-income countries where USAID provides over 20% of development assistance (Source: OECD, World Bank, cgdev.org)
Although the aid cuts will come as a big shock, many African leaders see the crisis as an opportunity for Africa to escape the dependency that has distorted policymaking and diminished self-esteem. The question is whether elites are ready to take more responsibility for the well-being of their own people. Especially because the coming shock will be quite visible. In recent years, Western countries have spent $60 billion on aid to Africa. The U.S. itself spent $12.7 billion in sub-Saharan countries in 2024. This represented 27 percent of global aid, and on average, aid accounted for about 4 percent of the gross national income (GNI) of African countries (other sources say 2.4 percent).
For those who want to see the three-dimensional world behind the numbers, here are a few examples, collected by the Economist, of the immediate effects of reducing Western aid. Aid helped 16 million people in Ethiopia survive in 2024. Aid helped prevent Ebola in the Congo and malaria in several countries. Without the usual support, hundreds of thousands of lives will be at stake, and who knows how many tens of millions will fall below the extreme poverty line by the end of the decade. These calculations show that cutting aid may help African economies stand on their own feet in the long run, but drastic, sudden cuts in programs will have disastrous, fatal consequences.
Does China See a Geopolitical Opportunity in the U.S. Retreat?
Without taking any steps, China has already gained a lot from the stormy retreat of the Trump administration. With its unexpected decision, the United States has lost the trust of the international community, and
The silent Chinese giant already looks more reliable. From now on, the “America First” policy in international waters means that China is stable and Washington is unreliable.
Experts have expressed two opposing views on China’s possible response. Many of them say that this is the perfect opportunity for China to fill the void left by the Americans in the so-called Global South. It is true that some of the former U.S.-funded projects in Cambodia, Colombia, or Nepal are already being taken over and supported by China.
However, another group of experts, including many African specialists interviewed by New York-based Semafor, say China has its own long-term strategy that won’t be influenced by external circumstances. Gergely Salát, a sinologist at Pázmány University, shares this view. Whatever direction the Asian giant chooses, the geopolitical game has already shaken.
The main difference between Western and Chinese presence in third countries is that aid policy has not traditionally been part of the Chinese political mindset as it is in Western countries.
Except for a few examples, China doesn’t provide large-scale humanitarian aid. China’s strategy focuses on economic engagement, infrastructure development, access to resources, security, and diplomatic influence.
Through the Belt and Road Initiative (BRI), China is investing in roads, railways, ports, and energy projects. This makes China the largest trading partner in Africa and Southeast Asia and secures vital natural resources such as oil and lithium. China is also expanding its soft power through Confucius Institutes, scholarships, and media presence. It seeks support – especially in Africa – in global forums while offering non-interference diplomacy, and it has also increased its peacekeeping efforts, establishing its first overseas military base in Djibouti. The overall weight of Chinese influence is such that, despite widespread concerns about debt dependency, labor issues, and environmental impacts, it is truly difficult to refuse Chinese business offers.
Non-interference diplomacy also means that with the demolition of USAID, civil society, democracy and human rights will suffer the greatest loss worldwide.
While USAID expected, at least in theory, to enforce human rights and democracy, Chinese influence will strengthen authoritarian regimes. Moreover, the dependence on China is likely to be one-sided.
Although there are other donors in the African and Southeast Asian region, such as Japan or South Korea, these actors also represent the infrastructure development approach and are hardly able to fill the void after the United States. This does not allow recipient countries to diversify and reduces their bargaining power. Investment announcements, such as President Xi’s $50 billion development package for Africa last year, will become more valuable and unrivaled. The current U.S. self-defeat seems quite incomprehensible from a president who began his second term with the primary goal of fighting China by any means necessary against what he sees as a threat to the global position of the United States.
The opportunity presented by the Trump administration could not have come at a better time for China. The Chinese economy has not been doing very well lately, and the BRI is slowing down. Now they have time to rethink and renew soft power projects and get back on track to become a transglobal leader. Since China’s aid policy is different from that of the West, and because the Chinese government doesn’t disclose its foreign aid budget, we only have estimates.
According to a Guardian article based on a study by William & Mary’s Global Research Institute, Beijing lent $1.34 trillion to developing countries between 2000 and 2021, mostly through the BRI. In 2018, it established the China International Development Cooperation Agency to develop aid effectiveness as a key foreign policy tool, and it is now the second-largest donor in the Pacific, entering a new era in which its biggest competitor seems to be disappearing.
Russia Celebrates USAID Abolition
How much the world has changed in recent weeks is best illustrated by the fact that autocratic leaders in Central Asia and Eastern Europe see Washington as an ally for the first time.
In 2023, USAID spent $17.2 billion in countries bordering Russia, 40 percent of USAID’s annual budget.
It mostly supported energy infrastructure projects, democratic reforms, and disease prevention, and a small amount of the budget supported local media platforms with funds and training courses for journalists who were out of control of government propaganda. The vast majority of the aid – $16.4 billion – was spent in Ukraine in 2023. However, other countries such as Azerbaijan, Belarus, Georgia, and Moldova were also among the recipients of these funds, which helped free the media and strengthen democratic consciousness.
The end of Western aid means that pro-democracy initiatives by civil society and NGOs in Eastern Europe will be existentially threatened and unable to function.
The loss of funds accelerates Russia’s goal of assuming the role of the region’s undisputed influencer. The Long Brief had the opportunity to speak with a journalist from one of the regional online newspapers in the Central European region who said they could not imagine their future without USAID support. This means that hundreds of thousands of people will be left without any sources other than the state propaganda media. The vacuum will be immediately filled by the already powerful Russian influence, and some of the local governments who now see the opportunity to reject democratic institutions have already announced that they will introduce laws to curb foreign influence from Georgia to Slovakia.
This dramatic indirect empowerment of Russia not only disempowers civil society but also reinforces the narrative of an untrustworthy U.S. and weakens confidence in democracies. It is beyond the scope of this article to analyze the extent to which European countries could take over the U.S. role in providing aid in the Eastern European region. Still, it is clear that the EU is hampered not only by its slow and bureaucratic functioning but also by the fact that it currently has to devote all of its capacity to strengthening its defense capabilities.
The Trump administration has stated that saving 0.24 percent of its annual GNI by eliminating USAID is necessary because its activities “may not align with US interest“. With the United States so far seemingly only voluntarily ceding ground to its biggest global rivals, the question is: what does? As Russia and China seek to advance a more authoritarian world, Washington’s ill-considered move not only weakens democracies around the world but also indirectly helps bring more uncooperative authoritarian leaders onto the global chessboard. As these figures speak only the language of force, the so far relatively balanced geopolitical chessboard appears to be tilting, and it is unclear at this point how this will serve the interests of the U.S., which has had the greatest influence in the world since the Cold War.
