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The Path to Development in a Post-Aid World

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10.08.2026

Fragile states, almost by definition, never have it easy. But for the roughly 60 poor countries that lack the capacity to perform basic responsibilities for their citizens, the last year and a half have been especially tough. For decades, these countries have subsided on a lean diet of foreign aid from major donor governments and the United Nations, the World Bank, and other multilateral institutions. Yet under President Donald Trump, the United States—traditionally the world’s largest aid provider—has slashed its assistance. Other major donor states have followed suit, as have multilateral organizations.

The cuts are causing serious damage. Foreign aid has done a great deal of good, including by helping poorer governments meet the basic needs of millions of people, and the reductions have already resulted in the deaths of over 500,000 children, according to an estimate by Brooke Nicols at Boston University. But for all its merits, the existing system has always been quite limited. Relying on foreign aid did not provide fragile states with a pathway to meaningful economic growth. It did not advance state capacity. Instead, it left recipient countries vulnerable to the whims of faraway powers, as the cuts have now made evident. For weak states to become strong, they need a new strategy, one that depends mostly on themselves.

Creating such a strategy will not be easy, nor will implementing it. Weak states are weak for a reason. But this task is not impossible. Fragile countries typically possess a wealth of natural resources and receive huge diaspora remittances. Managed right, these streams can provide governments with billions of dollars in revenue and help each country build a robust middle class. These states can create better systems of trade, and they can work across borders to promote internal and external stability. After all, countries typically suffer when their neighbors descend into chaos and thus have a shared stake in ensuring the region’s collective success.

When Trump returned to office in January 2025, he immediately laid waste to the existing system of economic development. On the very day of his inauguration, he dismantled the U.S. Agency for International Development, the body that accounted for the lion’s share of U.S. development and humanitarian assistance. He also promptly slashed or outright canceled Washington’s annual contributions to the Global Climate Fund, the World Health Organization, and over a dozen other UN agencies. The result has been the end of all kinds of development initiatives. Closing USAID, for example, resulted in the termination of well over 5,000 projects. Washington’s cuts to multilateral bodies, to which it was the largest contributor, has shuttered many other programs. Meanwhile, Trump’s heavy-handed use of tariffs has gutted long-standing provisions that gave vulnerable states advantageous trade terms.

The United States is not alone in pulling back. According to the Organization for Economic Cooperation and Development, other Western governments have slashed assistance grants and development loans to their lowest level since 2016. Belgium, France, the Netherlands, Sweden, Switzerland, and the United Kingdom have all slashed foreign aid in favor of defense spending and other domestic expenditures. These countries have traditionally been among the world’s leading providers of humanitarian aid, after the United States. The United Kingdom’s humanitarian assistance in the social sector, for instance, has fallen below pre-COVID levels, leading to cuts in health programs in........

© Foreign Affairs