USAID 90-Day Freeze Explained: What’s Halted, What’s Exempt, and Why It Matters

 

The U.S. Agency for International Development (USAID) has long been a crucial arm of the United States government’s foreign aid strategy, funding various humanitarian, development, and governance programs worldwide. However, on January 20, 2025, President Donald Trump signed Executive Order 14169, titled "Reevaluating and Realigning United States Foreign Aid," which initiated a 90-day freeze on all USAID programs globally. This move sparked widespread debate, with critics arguing it undermined critical humanitarian efforts, while supporters maintained it was necessary to scrutinize the efficiency and effectiveness of U.S. foreign aid spending.

Beyond immediate fiscal concerns, the freeze also reignited discussions about the broader role of U.S. foreign aid as a tool of soft power projection. USAID has historically played a strategic role in strengthening diplomatic relations, promoting American values, and enhancing global influence through targeted development assistance. However, critics of U.S. foreign aid programs have often overlooked instances of waste, fraud, and abuse that compromise efficiency. Every advocate of transparency should be invested in ensuring that taxpayer funds are not misused but rather channeled into impactful and well-managed initiatives. The freeze, therefore, presented an opportunity to reassess spending priorities and reinforce accountability mechanisms within USAID’s operations.

Background and Nature of the 90-Day Freeze

The executive order mandated a three-month halt on all USAID-funded activities worldwide to allow for a comprehensive review of how U.S. taxpayer dollars were being utilized in foreign assistance programs. This included funding for economic development, democracy-building initiatives, education, health, and humanitarian relief.

According to administration officials, the review aimed to identify inefficiencies, eliminate wasteful spending, and reassess U.S. priorities in foreign aid. The freeze affected USAID programs across multiple sectors and regions, leading to uncertainty among aid recipients and international partners.

Rationale Behind the Decision

The Trump administration justified the decision based on the following key arguments:

(a). The administration argued that some USAID programs were inefficiently managed or lacked proper oversight, resulting in wasteful spending. The freeze allowed for an in-depth audit of these expenditures.

(b). The review aimed to ensure that U.S. foreign aid is aligned with national security goals, preventing funds from indirectly supporting adversarial regimes or organizations.

 (c) Officials contended that long-term reliance on foreign assistance hindered self-sufficiency in recipient countries, advocating for a shift toward trade-based and investment-driven partnerships instead.

  (d). Several projects reportedly funded by USAID were deemed unnecessary or extravagant, prompting the need for re-evaluation.

What Has Been Discovered So Far?

As the audit progressed, several instances of questionable expenditures and misaligned USAID-funded projects came to light. These findings fueled debate over the necessity of the freeze and raised concerns about wasteful spending. Despite the agency's commendable work in saving lives and promoting humanitarian causes, allegations have surfaced regarding its involvement in controversial activities, including excessive and opaque spending, interference in foreign governments to effect regime change, and even funding non-state actors linked to destabilizing activities. Additionally, USAID has been criticized for financing programs that, under the banner of human rights and democracy, have allegedly clashed with the cultural and moral sensibilities of host nations, fostering tensions and divisions rather than promoting unity and development. Some of the most notable examples include:

    (i) Overpriced and unnecessary conferences: For example, a USAID-backed conference on economic development in Latin America, held at a luxury Caribbean resort, cost approximately $3.5 million, including expenses for high-end accommodations and extravagant catering. Critics argue that similar discussions could have been conducted virtually or at a lower cost, directing funds to actual development projects instead.

    (ii) Art and cultural programs with limited impact: For example, $2.1 million was funded for an abstract art exhibition in Europe aimed at "promoting cross-cultural understanding." While cultural diplomacy is important, analysts questioned why U.S. foreign aid was funding exhibitions in regions that are not high priorities for USAID’s core mission.

    (iii) Questionable consulting and administrative costs: For example, reports revealed that some USAID-funded projects spent up to 60% of their budgets on administrative overhead and consultant fees rather than direct aid. One notable case was a project in sub-Saharan Africa where nearly $7 million was allocated, but only $2.5 million reached local communities, with the rest absorbed by consulting firms.

    (iv) Redundant or overlapping programs: For instance, multiple USAID initiatives in South Asia aimed at small business development were found to duplicate similar projects funded by other international donors, such as the World Bank and the United Nations Development Programme (UNDP). The duplication led to inefficient resource allocation, as funding was channeled into programs that overlapped rather than complementing existing efforts.

  (v) Funding for politically sensitive or controversial projects: Reports emerged of a $5 million USAID grant supporting media training programs in Eastern Europe that some viewed as interference in domestic politics. The funding sparked diplomatic tensions with host countries, raising questions about whether USAID was being used for political leverage rather than purely humanitarian purposes.

While these findings highlight areas where USAID funds may have been misused or inefficiently allocated, critics of the freeze argue that halting all aid programs even those with proven effectiveness was an overly broad response that risked harming vulnerable populations. In response to these concerns, President Trump directed Secretary of State Marco Rubio to take over USAID as the acting director. The US State Department offices exist in nearly all nations where USAID operates, this transition was intended to ensure that exempted critical life-saving programs could continue without significant disruption.

Exempted Services and Active Regions

Despite the broad freeze, the administration exempted specific life-saving and emergency assistance programs. These exempted services remained operational due to their immediate humanitarian necessity:

#1. Emergency humanitarian food assistance: These programs are active in Sub-Saharan Africa (Sudan, Somalia, South Sudan), Yemen, Afghanistan etc.  USAID's Food for Peace continued to provide urgent food assistance to regions experiencing acute hunger crises.

#2. Life-Saving Medicine and Healthcare Services: This program is active globally, including South America (Haiti, Venezuela), Africa (Zimbabwe, Nigeria, Kenya) etc.  HIV/AIDS treatment under PEPFAR (The President’s Emergency Plan for AIDS Relief) remained active, ensuring ongoing access to antiretroviral therapy.

#3. Shelter and disaster relief assistance: This is active in the Middle East (Syria, Lebanon), Asia (Pakistan, Bangladesh), and Central America (Honduras, Guatemala). Shelter provisions and refugee support in war-affected areas continued to be exempted from the freeze.

#4. Programs for women and children in conflict zones: Active in regions like South Asia (Afghanistan, Pakistan), Africa (Democratic Republic of the Congo, Chad) etc. Assistance programs for displaced women and children, particularly victims of war and gender-based violence, remained funded.

The Need for Developing Countries to Take Responsibility

The USAID freeze has also sparked discussions about the role of developing countries in ensuring their own sustainable development. While foreign aid has been instrumental in alleviating poverty and supporting humanitarian efforts, it is not a long-term solution. Developing nations must adopt a mindset of self-reliance and discard any sense of entitlement to U.S. taxpayer-funded assistance. The reality is that these funds come from hardworking American citizens who deserve accountability and transparency regarding how their money is being spent abroad.

Instead of relying excessively on external aid, governments in developing countries should focus on strengthening domestic revenue generation, implementing good governance, and prioritizing essential services for their citizens. Investing in infrastructure, fostering economic growth, and reducing corruption are key strategies that can lead to self-sufficiency and minimize dependence on foreign assistance. The USAID freeze should serve as a wake-up call for recipient nations to take more proactive measures in addressing their challenges, ensuring that they are not overly reliant on foreign donors for survival.

Conclusion

The USAID 90-day freeze, initiated under the Trump administration, aimed to reassess U.S. foreign aid spending, identifying inefficiencies and eliminating frivolous expenditures. While some projects were found to be wasteful, characterizing the freeze as a blanket ban would be misleading given the numerous exemptions granted to critical humanitarian programs. The move also aligns with President Trump's campaign promise to 'drain the swamp' by making government operations more efficient and accountable. By scrutinizing USAID spending, the administration sought to enhance transparency and eliminate misuse of taxpayer funds. While the exemptions ensured the continuation of essential services, confusion and disruptions persisted in many affected regions. As the review concludes, the global development community awaits the long-term implications of this policy shift and its potential restructuring of U.S. foreign aid priorities.