The U.S. has significantly reduced its overseas development and aid budgets by 92%, equating to $54 billion, following President Trump’s executive order to freeze foreign aid on his first day in office. This pause allowed for a review of spending under his “America First” agenda, leading to the elimination of nearly 5,800 foreign assistance contracts and a 28% reduction in over 9,100 grants worth $15.9 billion. While programs such as food assistance and medical support remained intact, the cuts caused turmoil within USAID, resulting in the layoff of 1,600 employees and leaving most staff on administrative leave.
The United States has significantly reduced the budgets for international development and aid initiatives, with multi-year contracts cut by 92 percent, amounting to $54 billion, the State Department reported on Wednesday.
On his first day in office, US President Donald Trump issued an executive order that mandated a 90-day freeze on all US foreign aid. This suspension aimed to enable the administration to assess overseas expenditures to eliminate programs that did not align with Trump’s “America First” policy.
This review specifically examined multi-year foreign assistance contracts given by the US Agency for International Development (USAID), resulting in the cancellation of the vast majority.
“Following a process spearheaded by USAID leadership, including segments personally evaluated by Secretary (Marco) Rubio, approximately 5,800 awards with a total value of $54 billion were identified for termination as part of the America First strategy — a 92 percent decrease,” a spokesperson from the State Department stated.
The review also assessed over 9,100 grants related to foreign assistance, valued at more than $15.9 billion.
At the end of the review, 4,100 grants worth nearly $4.4 billion were selected for elimination, representing a 28 percent reduction.
“These practical eliminations will enable the bureaus, along with their contracting and grants officials, to concentrate on the remaining programs, discover additional efficiencies, and tailor future programs more closely to the Administration’s America First priorities,” the State Department statement noted.
Programs that remained unaffected included food assistance, critical medical treatments for diseases such as HIV and malaria, and support for nations including Haiti, Cuba, Venezuela, and Lebanon, among others, the spokesperson added.
On Tuesday, a federal judge ordered the Trump administration to reinstate all aid within less than two days after a previous court ruling from nearly two weeks prior was disregarded.
The Trump administration filed a request to suspend the lower court’s ruling, which was approved by US Supreme Court Chief Justice John Roberts late Wednesday, according to reports from US media.
USAID, established following the passage of a congressional bill in 1961, employed more than 10,000 individuals prior to the aid freeze, leading to shock and distress among its staff.
The agency announced on February 23 that it was laying off 1,600 of its employees within the United States and placing most of the remaining personnel on administrative leave.
During his election campaign, Trump pledged to reduce federal government spending and bureaucracy, a mission he entrusted to his top donor and close advisor, billionaire Elon Musk, as part of the newly established Department of Government Efficiency (DOGE).
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