USAID: US Cuts Foreign Aid Contracts By Over 90%
The United States has finally initiated a cut in its budget for foreign development and aid programmes, significantly slashing the multi-year contracts by 92 percent or $54 billion.
With the cut, about 5,800 identified foreign aid contracts have been gutted by the government.
The cut in the US’ foreign aid programs comes as the new administration of Donald Trump seeks to save as much as $60 billion from development and foreign humanitarian assistance.
Trump had signed an executive order on assumption of office, demanding a 90-day freeze on all US foreign aid to give his administration time to review overseas spending, with a view to gutting programs not aligned with his “America First” agenda.
A federal judge had on Tuesday given the Trump administration less than two days to unfreeze all aid after a previous court order issued nearly two weeks earlier went ignored.
But the Trump administration filed an emergency petition to the US Supreme Court, which issued an administrative stay late Wednesday, pausing the lower court’s order.
“At the conclusion of a process led by USAID leadership, including tranches personally reviewed by Secretary of State Marco Rubio, nearly 5,800 awards with $54 billion in value remaining were identified for elimination as part of the America First agenda, a 92 percent reduction,” US State Department said in a statement.
The administration’s review in part targeted multi-year foreign assistance contracts awarded by the US Agency for International Development (USAID), with the vast majority eliminated during its course.
It also looked at more than 9,100 grants involving foreign assistance, valued at more than $15.9 billion.
Following the review, 4,100 grants worth almost $4.4 billion were targeted to be eliminated, an 28 percent reduction.
“These commonsense eliminations will allow the bureaus, along with their contracting and grants officers, to focus on remaining programs, find additional efficiencies and tailor subsequent programs more closely to the administration’s America First priorities,” the State Department statement said.
USAID distributes US humanitarian aid around the world, with health and emergency programs in around 120 countries.
Programs that were not cut included food assistance, life-saving medical treatments for diseases like HIV and malaria, and support for countries including Haiti, Cuba, Venezuela and Lebanon, among others, the State Department spokesperson said.
Late Wednesday, US Supreme Court Chief Justice John Roberts issued the administrative stay, which grants the Trump administration temporary reprieve from having to unfreeze around $2 billion in payments for overdue foreign aid.
The decision also gives the court more time to consider the matter.
USAID, created after a bill passed by Congress in 1961, had a workforce of more than 10,000 employees before the freeze, which sparked shock and dismay among personnel.
During his election campaign, Trump promised to slash federal government spending and bureaucracy, a task he bestowed upon his top donor and close advisor, Elon Musk, as part of the newly created Department of Government Efficiency (DOGE).
Trump has said USAID was run by radical lunatics while Musk has described it as a criminal organization needing to be put through the woodchipper.
The agency announced on February 23 that it was laying off 1,600 of its employees in the United States and placing most of the remaining staff on administrative leave.
Speaking during the first cabinet meeting, Wednesday, Elon Musk, who heads the Department of Government Efficiency, said: “If we don’t do this, America will go bankrupt,” adding that he was “taking a lot of flak, and getting a lot of death threats.”