“It’s been run by a bunch of radical lunatics, and we’re getting them out, and then we’ll make decisions,” said U.S. President Donald Trump last week about USAID, the country’s $43 billion foreign aid agency, as he began dismantling U.S. foreign aid programs.
The statement followed Executive Order 14169, issued on January 20, 2025, which froze most U.S. foreign development assistance programs for 90 days pending a comprehensive review. Trump defended the move as necessary to curb wasteful spending and ensure that foreign aid serves “America’s interests.”
This unprecedented aid freeze impacts a vast global network of programs—not only humanitarian relief and global health initiatives but also security assistance, governance support, and economic development projects. USAID, a key player in fighting HIV/AIDS, building energy infrastructure in Africa, and containing infectious diseases like Ebola, has been brought to a standstill.
Trump’s hostility toward foreign aid is well-documented and he repeatedly sought to slash aid budgets during his previous presidency. His 2025 inaugural address underscored what he perceives as a conflict between foreign aid and his America First policy: “We have a government that has given unlimited funding to the defense of foreign borders but refuses to defend American borders.”
The freeze has sparked a firestorm of debate over the effectiveness of U.S. foreign aid, but also about the limits of the U.S. federal government’s reach, as the newly-created Department of Government Efficiency led by Elon Musk reportedly accessed classified information about programs at USAID—an independent agency—and even at the U.S. Treasury Deptarment without proper security clearance.
SpaceX CEO Elon Musk speaks during a rally on the inauguration day of U.S. President Donald Trump’s second Presidential term, inside Capital One, in Washington, U.S. January 20, 2025. REUTERS/Mike Segar/File Photo
Since the announcement of USAID’s “closure,” thousands of USAID employees have been placed on administrative leave, and critical global programs have been plunged into uncertainty. In response, a U.S. judge swiftly ordered that all USAID staff be retained until at least February 14.
Meanwhile, in an effort to mitigate the fallout, U.S. Secretary of State Marco Rubbio clarified that life-saving programs should resume despite the ongoing review. On Sunday night, former President Donald Trump stated that some of USAID’s “legitimate” programs might be transferred to the U.S. State Department, but for now, nothing is certain.
The Complexity of Foreign Aid: A Global System at Risk
U.S. foreign aid is a complex $68 billion (FY2023) operation spanning economic development, humanitarian relief, and military assistance, according to foreignassistance.gov. While often seen as charity, foreign aid is, in reality, the cornerstone of U.S. soft power, serving as a strategic tool to maintain U.S. influence abroad and address crises before they reach American shores.
A large portion of aid is classified as foreign assistance—funding for economic growth, governance, and humanitarian relief—mainly managed by USAID and the State Department. Contrary to popular belief, foreign aid is not simply about generosity; it is tied to U.S. strategic interests.
Criticizing the recent freeze on foreign aid, U.S. Congresswoman Sydney Kamlager-Dove, Ranking Member of the House Foreign Affairs Subcommittee on South and Central Asia, expressed strong opposition: “Abruptly stopping these programs weakens our ability to build influence abroad and leaves Americans vulnerable to the impacts of global crises.”
FILE PHOTO: A woman protests against Elon Musk outside the U.S. Agency for International Development (USAID) building after billionaire Musk, who is heading U.S. President Donald Trump’s drive to shrink the federal government, said work is underway to shut down the foreign aid agency, in Washington, U.S., February 3, 2025. REUTERS/in Washington, U.S., February 3, 2025. REUTERS/Kevin Lamarque/File Photo
On the other hand, critics argue that much of this spending is inefficient. A 2024 Congressional Research Service (CRS) report flagged serious concerns:
- Opaque spending – Over $50 billion in aid over the past decade went to unspecified or “redacted” recipients.
- High administrative costs – Some implementing partners report overhead costs as high as 50%, far exceeding the EU’s 7% cap.
- Concentration of funding – Just a few major recipients control billions, including faith-based groups and for-profit firms.
As a result, an increasing number of figures, including Elon Musk, have criticized USAID, with Musk stating:
“It became apparent that what we have here is not an apple with a worm in it, what we have actually is just a ball of worms.”
Foreign Aid in SE Europe: What’s at Stake?
Southeast Europe, a loosely defined geographical region still grappling with the legacies of war, economic instability, and influence from Russia and China, is a regular recipient of U.S. foreign assistance.
Considering the composition of Southeast Europe as per participant countries of the Regional Cooperation Council, the economies of the region received approximately $830 million in aid in 2023 as follows, according to foreignassistance.gov:
- Albania: $39 million
- Bosnia & Herzegovina: $94 million
- Bulgaria: $9.3 million
- Croatia: $4.7 million
- Greece: $891,893
- Kosovo*: $70 million
- Moldova: $309 million
- Montenegro: $4.9 million
- North Macedonia: $31 million
- Romania: $26 million
- Serbia: $47 million
- Slovenia: $3.9 million
- Turkey: $190 million (mostly humanitarian aid after the devastating 2023 earthquake)
Although Greece received a relatively modest sum compared to its neighbors, in 2023 U.S. foreign assistance supported education and social services ($550,000) as well as peace and security initiatives ($345,000).
FILE PHOTO: Equipment and supplies for the Urban Search and Rescue team from Fairfax, Virginia, and USAID to help in support operations for victims of the earthquake in Turkey are loaded onto a transport plane at Dover Air Force Base, Delaware, U.S., in this handout photo released on February 7, 2023. U.S. Air Force/Handout via REUTERS THIS IMAGE HAS BEEN PROVIDED BY A THIRD PARTY/File Photo
With U.S. funding now frozen, many regional programs face uncertainty, raising fears of economic disruption and security risks. A sudden withdrawal of U.S. aid could create opportunities for Russia and China to expand their influence in the Balkans, further complicating the geopolitical landscape.
The Broader Geopolitical Consequences for SE Europe
The U.S. aid freeze is not just an economic issue—it has far-reaching security implications:
- Destabilization of Allies: the countries of SE Europe (with the exceptation of Greece and Turkey) rely heavily on U.S. funding to support democratic institutions
- Chinese and Russian Influence: China’s Belt and Road Initiative has already made inroads in SE Europe and Russia regularly meddles. A U.S. withdrawal only accelerates this trend.
- Increased Migration Pressure: A weakened Balkans could lead to increased migration flows into Western Europe, further straining EU resources.
Former NATO commander General James Stavridis warned recently of the risks of diminished U.S. engagement in the region in an article entitled “How to Keep Putin and Xi Out of the Balkans.” In it, he writes “Serbia is becoming a focus of great-power conflict, and the EU and NATO can bring it into the Western fold.”
However, the problem for SE Europe is that Trump is also no fan of NATO.
Conclusion: A Blunt Instrument for a Complex Problem
The effectiveness of foreign aid is fiercely debated. While it undeniably saves lives in humanitarian crises and stabilizes fragile states, critics argue that aid often fails to promote sustainable economic growth.
FILE PHOTO: The shadow of a Philippine Army personnel is cast on boxes of relief items from U.S. Agency for International Development (USAID) for the victims of super typhoon Haiyan, at Villamor Air Base in Manila November 13, 2013. The Philippine government has been overwhelmed by the force of the typhoon, which decimated large swathes of Leyte province where local officials have said they feared 10,000 people died, many drowning in a tsunami-like surge of seawater. REUTERS/Cheryl Ravelo/File Photo
Bogolo Kenewendo, Special Advisor and Africa Director to the United Nations Climate Change High-Level Champions, has voiced frustration that “Grants do not promote economic growth, but private investments do. Private investments in Africa help create a stable middle class.”
This perspective is widely shared in developing and developed nations, where foreign aid, while valuable, is often seen as a short-term solution rather than a pathway to self-sufficiency. Without investment-driven development, many economies remain trapped in cycles of dependency, unable to transition toward long-term prosperity.
The real development challenge lies in striking the right balance: providing sufficient aid to stabilize struggling nations without fostering dependency, while determining when and how to transition toward private investment to sustain long-term growth. This is the critical dilemma policymakers must seek to address.
But Trump’s approach to foreign aid reflects little concern for solving this dilemma. His America First agenda, framed as a push for government “efficiency,” has delivered a foreign aid freeze that appeals to his conservative base—but at a growing cost. With each passing day, the risks of severe global repercussions intensify.
Essential programs are grinding to a halt, leaving a dangerous vacuum that geopolitical rivals like China and Russia may be eager to fill. What may have been intended as a show of strength, risks weakening America’s global influence and aspirations to be global hegemon and peacekeeper.
While U.S. foreign aid undoubtedly needs reform, an indiscriminate freeze does not fix inefficiencies—it amplifies them, and dismantles the very foundations that could drive meaningful change.
*This designation is without prejudice to positions on status, and is in line with UNSCR 1244 and the ICJ Opinion on the Kosovo declaration of independence.
