USAID: What happened when the funding stopped?
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Hello, this is Business Daily from the BBC World Service. I'm Sam Fenwick. Coming up today... The golden age of America begins right now. It's the 20th of January. Donald Trump has been sworn in as US President. I will very simply put America first. As he takes office, the US Agency for International Development, USAID, is one of the world's largest aid organisations.

It has more than 10,000 staff and an annual budget of around 40 billion US dollars. It operates across nearly every continent, supporting thousands of projects from providing critical health care in sub-Saharan Africa to fostering economic development in South Asia. America will soon be greater, stronger and far more exceptional than ever before.

But within hours of President Trump's inauguration, he signs an executive order, which imposes an immediate stop-work order on U.S. foreign development assistance programs. It's been run by a bunch of radical lunatics, and we're getting them out. USAID, run by radical lunatics. USAID-funded projects are halted,

whilst a review is carried out of their efficiency and how they align with US foreign policy. This abrupt halt doesn't just affect aid recipients. It

it filters through to local economies. You see more people walking because people don't have fuel anymore. And busy saloons, you find them almost empty. Today on Business Daily, we journey from the shores of Kenya's Lake Victoria to the slums of Nairobi to explore the economic impact of USAID's closure on communities, businesses and livelihoods that have long depended on its support. We are in Kisumu on the way to the lake Kisumu.

As you can see, the roads are very empty. All the small-scale businesses are waiting for customers. Originally from the Netherlands, Ali Eliveld has worked in primary healthcare in East Africa for 40 years. She moved to Kisumu in 1998 and in 2005 she founded a charity called the Safe Water and AIDS Project.

According to Ali, many aid workers are drawn to Western Kenya due to the region's urgent care needs. And over time, this has contributed to the development of an economy heavily reliant on aid grants. Kisumu County is a county which has the highest HIV rates and high burden of disease. And that's why there are a lot of organizations who were funded by U.S. governments, U.S. aid.

So if you were to walk down the high street, would you find that most of the businesses were in some way directly or indirectly reliant on the money coming through from USAID? Oh, definitely, especially the hotel industry is very much affected because USAID would really organize a lot of trainings and workshops and conferences in hotels. And also most people who worked in USAID programs

They were kind of like a bit elite. So going out in the weekends and eating in restaurants. So in terms of the impact on the local economy, how would you describe that? You see more people walking. You see less vehicles on the road because people don't have fuel anymore for their transports.

You see also that beauty salons, you find them almost empty because those are some luxury things which may be done by people who have good funding and jobs and they are also suffering. It was the speed at which projects were forced to stop which caught many people by surprise. So we're going to sign executive orders. First I'll revoke nearly 80 destructive and radical...

Barely moments after the ink dried on President Trump's executive order, emails like these, seen by this programme, began flooding the inboxes of aid organisations, charity groups and government offices across the globe.

Dear USAID Implementing Partners, In accordance with President Trump's executive order, the contracting-slash-agreement officer hereby issues an order for the contractor or recipient to immediately stop or suspend work under this contract. Dear Implementing Partner, This award is being terminated for the convenience of the U.S. government pursuant to a directive from the U.S. Secretary of State, Marco Rubio.

This award is hereby terminated effective immediately as of the date of this letter. The Trump administration argues that these steps are necessary, claiming that USAID was bloated, inefficient and out of step with American values. On the 3rd of February, Donald Trump advisor Elon Musk posted on his social media platform X that the administration was feeding USAID to the wood chipper.

The following day, Secretary of State Marco Rubio appeared on Fox News, where he was interviewed by their State Department correspondent, Rick Edson. So you're now the head of USAID. Can it be reformed or does it need to die? Well, that was always the goal was to reform it. But now we have rank insubordination. Now we have basically an active effort. Their basic attitude is we don't work for anyone. We work for ourselves. No agency of government can tell us what to do.

So the president made me the acting administrator. I've delegated that power to someone who's there full time. And we're going to go through the same process at USAID as we're going through now at the State Department. This is not about getting rid of foreign aid. There are things that we do through USAID.

that we should continue to do that makes sense. And we'll have to decide, is that better through the State Department or is that better through something, you know, a reformed USAID? That's the process we're working through. The USAID review, originally set for 90 days, was completed in just half that time. On March the 10th, the Secretary of State, Marco Rubio, announced the cancellation of 83% of USAID's contracts.

USAID has been instrumental in supporting Africa's largest slum, the Kibera community in Kenya. Initiatives have focused on improving healthcare, education and creating jobs to boost economic opportunities. But the recent funding cuts have left residents facing an uncertain future, as our reporter Michael Koloke has been discovering.

This particular area where I'm standing, I was used to seeing quite a number of signs indicating USAID projects in the area, but I don't see them anymore.

much really. I've been walking around here and I've noticed that there are not many of them at the moment. I'm aware that there are several youth here who are employed and I'm basically hoping to find out what are some of the young people who are involved in these projects doing. My name is Sharon Akoth.

I was a mentor, a facilitator, group therapy for girls with mental issues. Could I ask how much were you earning in this project?

It was depending. For mentorship, I was earning 8,000 shillings a month. Facilitation, it was depending. You could earn up to 30,000. Mental health, you could earn up to 12,000. It was good money. So basically we're talking of amounts between 70 US dollars to about...

So what happened? What was your initial reaction when you read that email?

I was so stressful because I was imagining how I was going to cope with my life because my mom is relying on me. I have rent to pay. I have an ailing father who is relying on me. I was wondering how I was going to cope with that situation. I have fees to pay for my child and I was wondering if I'll be able to do that. I'm praying that God will give me strength so that I can be able to go look for work.

My name is Likstito Vilembwa. I'm a community worker, mostly implementing the HIV prevention programs. Have you found another job to do? To find a job, it's not easy because the rate of unemployment in our country is a bit high. The only job you can find outside there is casual jobs. It's not just those directly employed by USAID projects who are feeling the impact of the cuts. As I look around, I see shops made from corrugated iron sheets,

businesses that relied heavily on the local workers these projects supported. There's a barber shop I can see here, a clothing store, and a woman beside me selling fruits and vegetables. All these small businesses are struggling

Joseph Asunga is a landlord who had been renting out a property to an NGO. Now that the organization has moved out, he's deeply concerned. That building was just helping us to get money so that we can complete a project which was already started. So you are using the rental income to construct other buildings? Yeah, yeah, yeah. What is the situation like now for you? I mean, basically the work in your new building has stopped?

So basically what you're saying is that that project was taking care of children in the slum. Since the project stopped, the children are just walking around on the streets? Yeah, they have lost their future.

In 2023, the most recent year with complete official data, the United States provided Kenya with $850 million in aid.

Nearly half of this funding supported health care programmes, while USAID backed over 230 initiatives across the country. It's young girls in particular who are most affected, says Ali Elivald, who leads the Safe Water and AIDS Project in Western Kenya. It is really heartbreaking because HIV-positive girls who are under scholarship, they're now just being told it's not going to happen, so their future is scattered really.

And there's also the issue of menstrual hygiene management that has also been stopped. And we know there will be a risk of girls now going into transsexual sex, looking for boyfriends to pay for their sanitary pads because they are not giving the supplies anymore. Some people would find it surprising that this has happened in a matter of weeks.

Yeah, it is because some organizations were 100% relying on USAID funding. So they have even closed and sent all their staff home. So people are in crisis management and are working on shoestring budgets. I think there has been a very high dependency on US funding. And that's also a bitter lesson we are learning now. You're listening to Business Daily from the BBC World Service.

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I'm Sam Fenwick, and today I'm exploring the impact of cuts to USAID funding. One recurring criticism is that the funding can sometimes create dependency among local agencies, leaving them struggling to sustain programmes when support is scaled back or withdrawn. I contacted key US government figures for their perspective on this issue. Some were unavailable, and others didn't respond to my request for comment.

Committee on Foreign Affairs will come to order. I ask that everybody in the room... The issue was recently raised during deliberations by the House Committee on Foreign Affairs in Washington, D.C., which examined the challenges associated with USAID funding. The hearing was opened by the chairman, Republican Brian Mast. The purpose of today's hearing is to discuss the misuse of public trust through USAID's woke programming system.

and explore ideas for reorganization to promote a stronger, better, and more prosperous United States. Following Mr. Maas, the committee heard opening statements from witnesses. The first to speak was Max Primorak, who served as chief operating officer and chief assistant to the acting deputy administrator of USAID during the first Trump administration. These funds proved a boon for the progressive-dominated foreign aid industry,

President Trump's leadership has created a unique opportunity to fast track important reforms of our aid system. Secretary Rubio might look at the reforms made during the last Trump administration. Our starting point was that the purpose of foreign aid is to end the need for it.

The committee then heard from Ted Yoho, a former U.S. representative for Florida who served from 2013 to 2021. During his tenure, Mr. Yoho chaired the House Foreign Affairs Subcommittee on Asia and the Pacific, where he played a key role in shaping U.S. foreign aid and international relations. I realize that foreign aid, when used properly, can be a tool in soft diplomacy that strengthens the nation's economy.

security, increases trade, decreases migration, creates strong partners and allies. Mr Yoho emphasized to the committee the importance of countries reducing their reliance on foreign aid to foster greater self-sufficiency. My goal was to move countries from aid to trade with the use of effective tools managed correctly. Even aid organizations that haven't directly received USAID funding are feeling the ripple effects of these cuts.

And this highlights a broader challenge, balancing the push for independence with the reality of reduced resources. Dr. Sheila Davis, CEO of Partners in Health, highlights the struggle. Her organization currently operates 11 programs across 10 countries, including Haiti, Peru, Rwanda, Mexico, Sierra Leone, Liberia and Malawi.

It received no more than 15% of its funding from USAID, but Dr. Davis says they're still feeling the impact of cuts. We're part of a system. Our whole goal is not to create parallel systems, but to go and supplement the strengthening of public health.

overall. And so when these core components were pulled out abruptly overnight, this system is collapsing. Can you give us some examples of where the knock-on has affected you? In Lesotho, a place where we've worked for many years, I think there are about 1,200 direct frontline healthcare workers that lost their jobs. So nurses, lab techs,

pharmacy techs, people who are doing the direct care, but there's not the staff there or there's one nurse rather than four. There is no way that she can hold up this entire health system by herself. So even the strands that remain are being stretched to the point where it's going to fail because there's not a system supporting it. When you look at the collapse of the system, does it perhaps suggest that people

that organizations and countries and governments were just too reliant on U.S. aid and that it wasn't a sustainable model? You know, I think we've set up this model and fed this model. There's structures that have been set up for years. There was no other way that the aid was actually getting there. So it's not like countries could choose. We're going to take money from USAID or

oh, this isn't the best way for us to build a system, so we're going to get it from door number B. That didn't exist. This was the only thing that was there. And so I also think we need to take responsibility for how this has emerged. You know, we all know that foreign aid could have been done in a more efficient way. I don't think anyone is denying that. So what you're suggesting is that you don't disagree that there wasn't reform needed? Right. Reform was needed. Yes.

But the way that this has been done, it's been too much of a shock. Yeah, I think the way it was done is immoral. Amidst the legal battles and policy debates surrounding USAID, one thing is clear. The ripple effects of these funding cuts affecting nearly all of their projects are being felt far and wide, challenging nations, organisations and individuals to adapt.

That's all from today's programme. I'm Sam Fenwick. You've been listening to Business Daily from the BBC World Service.

When you have bars in the sky, onboard showers and award-winning in-flight entertainment, it's no surprise that Emirates was recently named the best airline in the world. We fly you to over 140 destinations and with partners across the globe, we connect you to another 1,700 cities across six continents. So when we say we're also the largest international airline, what we really mean is...

If you're going there, so are we. Book now on Emirates.com. Fly Emirates. Fly better.