March 19, 2025
DHAKA – In January 2025, the Trump administration froze all USAID foreign aid, causing widespread disruptions to global humanitarian efforts. The decision led to the agency’s website being taken offline, workforce reductions, and plans to dismantle USAID under Elon Musk’s leadership of the Department of Government Efficiency (DOGE).
By February, US Secretary of State Marco Rubio sought to merge USAID’s functions into the State Department, while oversight of $8.2 billion in aid became non-operational. A federal judge ordered the freeze to be lifted on February 14, but administration officials refused to comply, leading to legal battles and heightened uncertainty about the future of US foreign assistance. By this time, a list of projects had already announced the termination of their contracts, including a $29 million project from Bangladesh.
It has been a month since the Trump administration’s stop-work order. A BBC Bangla report highlighted how the funding cuts are impacting NGO workers in Bangladesh. The report referenced the NGO Affairs Bureau, which stated that 274 NGOs in the country receive funding from various international sources, with 87 of them directly funded by USAID. Through these organisations, around 240 NGOs operated projects in Bangladesh. As a result, USAID funding for a total of 327 NGOs has been affected.
According to the NGO Affairs Bureau, more than 10,000 employees were directly employed in USAID-funded projects, all of whom have now become unemployed. Most of these employees were working on a contractual basis, meaning they did not receive severance or financial compensation. Consequently, they are facing immense uncertainty, struggling to support their families after suddenly losing their jobs.
Meanwhile, essential services such as healthcare, education, agriculture, food security, democracy, governance, environmental protection, energy, and humanitarian assistance have been severely affected, putting millions of underprivileged people at significant risk. An official from an NGO, speaking on condition of anonymity, said, “I left a permanent job just three months ago to join this organisation in a slightly senior position. My employment here had not yet been made permanent. In this situation, I have now been informed that my job no longer exists. I feel like I have been thrown into the deep sea with my family.”
The abrupt suspension of US foreign aid has sent shockwaves through the global humanitarian sector, leaving millions of crisis-affected people without essential services. A survey conducted by the International Council of Voluntary Agencies (ICVA), a global NGO network promoting principled and effective humanitarian action, found that the funding freeze has resulted in large-scale disruptions to health, nutrition, education, and protection services, exacerbating already dire conditions in vulnerable communities. With 246 NGOs responding to the survey, the findings paint a grim picture: 67 percent of organisations reported receiving Stop Work Orders (SWOs), leading to immediate programme shutdowns, staff layoffs, and increased risks for already at-risk populations.
The immediate impact: Lives at risk
The impact of the funding suspension has been catastrophic. The hardest-hit regions include Africa, Asia, the Middle East, and Latin America, where thousands of humanitarian projects have been abruptly terminated. The survey found that many NGOs relied on US funding—primarily through USAID’s Bureau for Humanitarian Assistance (BHA) and the Bureau of Population, Refugees, and Migration (PRM)—to sustain their operations. The funding freeze has led to a “sudden stop in lifesaving support” for over three million internally displaced people in one unnamed Asian nation alone. Medical services have been severely impacted. In Africa, HIV-positive children are dropping out of treatment programmes due to medication shortages. In Asia, cholera and malaria prevention efforts have been halted, increasing the likelihood of outbreaks. In the Americas, the suspension has forced the closure of sanitation facilities providing clean water and hygiene services to thousands of Venezuelan refugees, heightening public health risks.
A staff member of a community-based organisation in Africa shared their concern in the survey: “We have orphans for whom we pay school fees and provide scholastic materials. We are confused about how they will return to school under these circumstances. Directors are planning to solicit funds from personal savings where possible to ensure these innocent children do not miss school.”
The effects of the funding freeze extend beyond service disruptions. ICVA’s findings indicate that the suspension has eroded trust between NGOs, governments, and local communities. Many NGOs now face liquidity crises as the US government owes millions in unpaid reimbursements. Without these funds, organisations have been forced to downsize, scale back operations, or shut down entirely. Around 55 percent of NGOs reported a negative impact on their workforce, with widespread staff terminations and unpaid leave. The loss of trained humanitarian personnel threatens to dismantle years of progress in capacity-building and crisis response, further jeopardising the ability of NGOs to address emerging crises.
Women and children: The most affected
The suspension has disproportionately affected women and children, who are already the most vulnerable in crisis situations. The report highlights increased risks of gender-based violence, child labour, and early marriage as families struggle to cope with the loss of assistance. One NGO in Latin America reported that the cessation of advocacy programmes has made it harder for survivors of domestic and sexual violence to seek justice, increasing impunity for perpetrators. In Africa, orphans and children affected by HIV/AIDS have lost access to education and nutrition programmes, putting them at even greater risk of exploitation.
A global ripple effect
The funding halt has triggered a ripple effect across the broader humanitarian sector. UN agencies and international NGOs (INGOs) that rely on US funding to support local partners have had to pass on the cuts. More than 80 percent of NGOs receiving US funding depend on intermediaries like INGOs or the UN to channel resources. With these organisations also facing funding constraints, the entire humanitarian infrastructure is now at risk of collapse. A director of a national NGO in Latin America reported in the ICVA survey: “We are experiencing the loss of highly qualified professionals for community-based disaster risk reduction, and the loss of professionals in key and strategic positions in the institution who have partial funding in their salaries.”
A call for action
If the funding suspension remains in place, humanitarian needs will continue to rise due to ongoing conflicts, climate change, and economic instability. The ICVA report underscores that the longer the suspension continues, the harder it will be to rebuild the humanitarian infrastructure that has taken decades to develop.
Urgent action is needed to restore funding, ensure timely reimbursements, and protect the most vulnerable from the devastating consequences of these decisions. The crisis triggered by the US funding suspension is not just about money—it is about human lives. The international community must step up to prevent further suffering and ensure that humanitarian aid remains apolitical, neutral, and accessible to those who need it most.
Furthermore, a long-term strategy is needed to help local NGOs survive without excessive dependence on foreign aid. In Bangladesh, where the NGO sector has played a critical role in improving human development indicators, the government must also take responsibility for supporting this sector in its time of crisis.
Mohammed Norul Alam Raju is a researcher and development activist, currently residing in Belgium, pursuing higher studies in Development Policy and Management. He can be reached at: raju_norul@yahoo.com.
Views expressed in this article are the author’s own.