The Trump administration’s dismantling of USAID carries deep consequences for the EU’s foreign and development policy goals. Andrew Sherriff argues that the EU should grab this opportunity if it wants to strengthen its global relevance and show that it can be a more useful and reliable partner.
The turmoil sparked by the Trump administration’s dismantling of USAID is a game-changer. It has broad implications not only for humanitarian and development outcomes affecting vulnerable people and US soft power. It also carries deep consequences for the EU’s foreign and development policy goals. The EU must respond quickly and strategically, and above all together. Furthermore, the EU must grab this opportunity to show that it can be a more useful and reliable partner if it wants to have global relevance and impact.
The four Ms of change that have caught Europe off guard
Momentum
The sheer speed with which the Trump Administration executes changes is staggering. Even seasoned observers who had read Project 2025’s chapter on USAID did not anticipate such rapid and deep restructuring, leaving many wondering, what’s next? While there has been some pushback in the US courts, the US Congress has not intervened as some had hoped. This is a system change at an unfathomable pace that will leave many questioning whether the US is a reliable partner in the future.
Money
In global financial terms or within the US federal budget, aid is relatively minor — usually representing between 0.7% and 1.4% of the annual federal outlay. However, for the international development system, the US remains the largest single provider of Official Development Assistance (ODA), contributing $65 billion compared to the EU institutions’ $26 billion in 2023 and the European Union (EU) as a whole $92 billion. The speed of the US funding freeze and downsizing means that most programmes just came to a sudden halt with no warning or possible adaptations. Many development programmes and initiatives, aligned with partners’ goals and US and EU interests, will simply cease or suffer significant downsizing.
Mess
What is happening with USAID is not an orderly wind-down or even a messy merger (akin to the United Kingdom’s DFID’s integration into the Foreign Office). Instead, it is an abrupt gutting of USAID. The organisation’s workforce has been slashed from 10,000 to around 600, leaving countless unanswered questions and a skeleton staff to address them. Many direct partners of USAID – some of whom also work with the EU – are in limbo, unsure of the actual impact or what comes next. While not everything will be permanently shuttered after the noted 90-day White House executive order, what gets restarted or allowed to continue remains very uncertain. The full extent of the turmoil remains ongoing at this stage. Stories of direct impact on recipients of USAID are coming in as the money is stopped from Gaza to South America, Uganda and Malawi.
“This shift signals that the US fundamentally questions the value and legitimacy of much of its international cooperation and of the multilateral system connected to it.”
Message
This shift signals that the US fundamentally questions the value and legitimacy of much of its international cooperation and of the multilateral system connected to it. It also seems to assume that foreign aid overall has not brought economic or political benefits to the US, neglecting the tight link between the promotion of US values, of markets for US companies and stability in the very same places that received US assistance. The message and method will not go unnoticed by Europe’s hard-right factions. The risk of contagion around this approach within Europe is real.
Will the EU mirror the Ms?
Momentum
The EU must act decisively and fast, not passively observe. It must rapidly assess the impact of this policy shift on humanitarian and development outcomes and its own soft power ambitions and come up with a response. This is already happening in Ukraine, where the EU is scrambling to identify gaps left by USAID and how to respond, but it is also important that the EU has a similar sense of urgency in other places, too. The EU must craft targeted but collective messages for the US Secretary of State Rubio, who will visit the Munich Security Conference this week. More specifically, the EU should make sure that the response is on the agenda of the relevant Council of the EU working parties, Director-General meetings, the Foreign Affairs Council and EU Heads of Mission meetings in third countries.
“National authorities and multilateral partners hoping the EU will step in to fill the funding gap left by the US will be disappointed in most cases.”
Money
National authorities and multilateral partners hoping the EU will step in to fill the funding gap left by the US will be disappointed in most cases. The EU is evolving its international cooperation and is already cutting back on ODA, making difficult choices on country allocations and priority issues. There is little appetite for a direct confrontation with the Trump administration, for simply filling ‘gaps’ or being the donor of last resort. The message so far is that the EU is already doing its fair share, and its international engagement needs to be more focused, strategic and aligned with European interests.
EU long-term budget negotiations are about to start, and a strong case must be made for why external EU spending is now even more strategic and important in light of the US withdrawal. The EU must allocate sufficient resources and prioritise strengthening partnerships with emerging economies and developing countries as well as bolstering an international system from which it has benefitted. The case is one of investments in supporting the multilateral system, advancing development outcomes, tackling global challenges and protecting Europe’s long-term economic and strategic interests. The argument that with a US withdrawal, China and Russia will step in unless the EU steps up will also resonate with some unconvinced traditional humanitarian and development arguments.
The EU should also actively uphold the moral, values-based justification for investing in humanitarian aid, human rights, democracy and health.
Mess
In many regions, the EU and the US are collectively lumped together as ‘the West’. As such, this US-created aid crisis will inevitably reflect on the EU as well. The EU must seize the opportunity to increase its commitment to partners, visibility and impact as a coordinated front. Since the COVID-19 pandemic, the EU has been working to strengthen intra-European collaboration, aligning EU institutions, member states, operational agencies, development banks and finance institutions under the ‘Team Europe’ approach at the global level and in countries. While this approach has its challenges, it offers both geopolitical and operational logic, making a coordinated European response even more crucial amid US aid disarray. The challenge is that despite much talk of ‘Team Europe’ and the EU working together, this will require some serious political and top bureaucratic level investment and goodwill ‘in country’ to actually happen successfully.
Even though many European nations are cautious about provoking the Trump administration, a collective EU approach is the only viable response. The EU must conduct a thorough assessment and establish an equitable and effective ‘division of labour’ to address the consequences of US shuttering USAID and cutting aid. 27 states and national actors going their own way is a recipe for less EU impact and global relevance.
Message
The EU must consolidate a strong, clear narrative around the value of its development and humanitarian assistance efforts and its broader investment in soft power and international partnerships. This message will have to go beyond traditional arguments and constituencies for aid that are increasingly politically marginalised. While some European political forces on the hard right may view the dismantling of USAID with approval, if not admiration – sharing a similar worldview to the Trump administration – the overwhelming consensus from most foreign policy analysts is that this rapid shift is deeply troubling. Furthermore, the EU, lacking the US’s hard power, would do even more damage to itself if it tried to emulate this approach.
The EU is shifting its development cooperation narrative from ‘do-good’ assistance to one of mutual benefit and shared interest, positioning development as a tool to address global challenges, serve humanitarian and development goals, address broader foreign policy objectives, build win-win partnerships, and create opportunities for Europe. This shift is most evident in the EU’s Global Gateway strategy and recent calls for an economic foreign policy that underpins a domestic boost to EU competitiveness. Yet, with the rapid shifts in the US and the dramatic consequences for aspects of human development around the world. It has become even more urgent for the EU to reinvigorate a better response and offer around fragile states, education, democracy, sexual and reproductive health and rights, and climate change precisely because the US will be drawing back and the EU still has interests there.
Conclusion
It would be misguided to frame the USAID dismantling solely as a US-EU issue or give the impression that development or humanitarian outcomes are entirely reliant on USAID or, for that matter, aid. Indeed, remittance payments to low and middle income countries are larger than Global ODA or foreign direct investment combined. Many in the Global South have already responded or viewed this US shift as a wake-up call to pursue self-sufficiency and reduce reliance on external, and now ever more unpredictable, international aid.
The abrupt dismantling of USAID presents a seismic shift in international development, even if the final cuts are less severe than expected or if a rump aid administration is created within the US State Department. The EU must respond swiftly and strategically to mitigate the fallout, ensure continued support for vulnerable populations, and bolster its strategic partnerships. While the challenges are immense, a coordinated and strategic European approach can provide a much-needed counterbalance to US disengagement while differentiating the EU. The alternative is more chaos, more lives lost, more risk, and more scepticism about the motives and reliability of the West from global partners.
About the Author
Andrew Sherriff is the associate director of institutional relations and partnerships at ECDPM. He is also a member of the management team.