Policy Updates

On March 28, 2025, the US administration announced plans to merge USAID into the State Department, dissolving it as an independent agency and reducing staffing to a statutory minimum of 15 positions, and additionally detailed specific cuts to USAID grants and multilateral funding.

Congress must pass new legislation to officially eliminate the agency. The State Department will create an Office of Global Food Security to manage food security and humanitarian programs previously handled by USAID. The remaining global health programs will be supervised by the Bureau of Global Health Security and Diplomacy. Other programs will be managed by regional bureaus within the State Department.

Deputy administrator of policy and programs at USAID Jeremy Lewin informed staff that employment contracts would be severed by July 1 or September 2, 2025. By July 1, 2025, the State Department will fully take over USAID’s remaining programming. By September 2, 2025, USAID’s operations will transfer to State or shut down completely.

The administration also provided Congress with documents listing 5,341 terminated USAID programs and 898 active ones, detailing that 86% of programs have been terminated, slightly more than the 83% cut reported on March 10, 2025. The total value of terminated programs is US$75.9 billion, with US$48.2 billion already obligated and US$27.7 billion yet to be assigned.

UN institutions and other multilaterals saw steep cuts, with terminated awards totaling US$4.1 billion to 14 UN agencies, the IBRD, and Gavi.

On March 26, 2025, a spreadsheet detailing which USAID projects will continue and which will end indicated that the US administration plans to continue 898 USAID awards and end 5,341.

A spokesperson for the State Department, now overseeing USAID, confirmed the terminations. Some grants for HIV and tuberculosis medications, and food aid for countries in civil wars and natural disasters will continue. Spending on health programs like HIV vaccinations is congressionally allocated, and it is unclear if the administration has the unilateral legal power to end them.

USAID funding has mostly been eliminated, with only 869 of 6,000 employees remaining active. Remaining programs are, according to the administration, valued at up to US$78 billion, but only US$8.3 billion is unobligated funds intended for future disbursement. This suggests a massive reduction from the previous annual USAID spend of US$40 billion.

Programs terminated include funding for the FAO, which monitors diseases transmitted from animals to humans in 49 countries. Major programs to track and fight malaria have also ended.

On March 26, 2025, it was reported that the US plans to end financial support for Gavi, terminating a grant valued at US$2.6 billion through 2030, with US$1.8 billion yet to be disbursed.

Gavi is estimated to have saved the lives of 19 million children since its creation 25 years ago. The US contributes about 13% of its budget.

The loss of US funds will set back Gavi's ability to continue providing basic services, like immunizations for measles and polio. By Gavi’s estimate, the loss of US support may mean 75 million children do not receive routine vaccinations in the next five years, resulting in over 1.2 million child deaths.

The US became the largest donor to Gavi during the COVID-19 pandemic. While European countries have historically provided significant funding, many have announced plans to reduce development spending. Japan, another major Gavi donor, has also struggled with a depreciating currency.

On March 19, 2025, reports emerged that officials from the US Trump administration have developed a proposal to overhaul the US international assistance and development architecture following the recent dissolution of USAID.

The plan aimed to create a more streamlined approach, positioning US efforts to better counter China's influence globally. Key components include renaming USAID to the US Agency for International Humanitarian Assistance, significantly narrowing its focus to global health, food security, and disaster response, while embedding it within the State Department.

The proposal also suggested consolidating the MCC and the US Trade and Development Agency under the US International Development Finance Corporation, creating a unified entity dedicated to promoting private sector investment in infrastructure, energy, and technology. Additionally, it proposes relocating politically oriented programs, such as democracy promotion and anti-human trafficking initiatives, under the State Department.

Criticizing existing US development programming as “inefficient and fragmented,” the plan advocated for a more targeted strategy that fosters stability in regions vital to US interests. It emphasizes setting end dates for aid programs, measuring their success, and proposed using blockchain technology for enhanced accountability. This proposal follows significant changes to USAID, indicating a potential revitalization of critical programs aimed at combating infectious diseases and ensuring food security.

On March 18, 2025, Peter Marocco, the person largely responsible for driving the dismantling of USAID, pronounced 'Phase II' of the US foreign assistance review done and returned to his role as director of the Office of Foreign Assistance at the State Department, where he is expected to maintain influence over the ongoing reconfiguration of USAID.

Marocco announced via email that Jeremy Lewin, a staffer from DOGE, has been appointed as the deputy administrator for management and resources and chief financial officer. Kenneth Jackson, a recent political appointee, has been appointed as the deputy administrator for management and resources and chief financial officer.

Marocco reflected in a missive on his tenure at USAID, asserting that the agency has become “accountable and stable,” and expressed his intention to restore value to American foreign assistance.

On March 18, 2025, a federal judge ruled that DOGE efforts to dismantle USAID are likely unconstitutional.

Judge Theodore D. Chuang, of the US District Court for the District of Maryland, criticized Senior Advisor to the President Elon Musk’s unappointed role in the process, stating that it violated the Appointments Clause of the Constitution.

The Trump administration, with Musk’s involvement, had begun shutting down the USAID headquarters and terminating the vast majority of staff. The judge ordered an immediate halt to these actions and the restoration of system access for USAID staff.

However, the ruling also noted that such actions could continue with the express approval of a USAID official with the proper legal authority. Secretary of State Marco Rubio announced that he had taken control of the agency on February 3, 2025, delegating authority to Pete Marocco, the director of foreign assistance.

On December 17, 2024, the global campaign for assistance and development transparency, Publish What You Fund, released the report Commitments Without Accountability, which compares leading donors' commitments to locally led development, enabling effictive tracking and reporting on implementation.

The study focused on the extent to which donors had increased direct funding to local organizations. Of the five donors, including the Australian Department of Foreign Affairs and Trade, USAID, GAC, the Netherlands' Ministry of Foreign Affairs, and the UK’s FCDO, only USAID had the strategies, policies, comprehensive targets, and measurable public data to track its direct funding target.

The analysis created a Local Funding Matrix which looked at definitions, measurement, strategy, and policy to compare these 5 OECD DAC donors. Only USAID fulfilled all of the criteria; Australia has progressed in developing strategies, policies, and establishing a definition of local.

This work builds on Publish What You Fund's Metrics Matter series which tracked USAID 's progress towards its own 25% target by 2025, of which USAID is currently off track to meet. A third Metrics Matter report will be released in the spring of 2025, which will include all 5 donors.

On December 12, 2024, USAID announced an additional US$29 million in support for Somalia to support resilience and food security in Somalia, where 7 million people require assistance due to natural disasters, disease, insecurity, and poverty.

The funding is part of two 5-year programs aiming to assist 880,000 vulnerable households in South Central Somalia. USAID is partnering with World Vision and Save the Children to provide services including health, WASH, and nutrition, while also strengthening households' ability to cope with future challenges."

On December 10, 2024, the US signed a guarantee for a US$20 billion loan for support to Ukraine through the World Bank's F.O.R.T.I.S. Ukraine FIF.

The loan aims to address Ukraine's financing needs caused by the Russian invasion, with repayment sourced from revenues generated by frozen Russian sovereign assets held by the EU.

The World Bank serves as the fund's trustee and administrator, with contributions from Canada, Japan, and the US.

On December 3, 2024, USAID and NASA announced the expansion of its SERVIR program to include a new hub in Central America.

The hub works at the local, national, and regional level to allow evidenced-based decision making to address issues such as deforestation, soil erosion, and degradation of coastal ecosystems. The hub works with a range of institutions, governments, and communities providing opportunities to young people and others to use tools in STEM. The hub will expand satellite data and geospacial technologies to better equip the region in addressing environmental challenges with an initial investment of US$7 million.

SERVIR hubs are already operating in Africa, Asia, and Latin America.