When Aid Fades: Impacts and Pathways for the Global Democracy Ecosystem

This report assesses the impact of the foreign aid cuts on the global democracy ecosystem.

Active

Since 2025

Stockholm

In January 2025, the United States (US) administration initiated a sweeping overhaul of foreign aid, closed USAID, consolidating it into the State Department, and froze all aid programmes. By March 2025, the review concluded with the termination of 86% of USAID and 41% of State Department awards, amounting to approximately $80.5 billion in cuts. These decisions dismantled decades of US investment in humanitarian aid, health, education, agriculture, economic development and, most severely, democracy, human rights, governance, and peacebuilding (DRGP) programmes, where 97% of projects were cancelled. The scale and speed of the cuts have destabilized thousands of organizations worldwide, undermined civil society, weakened independent media, reduced protections for human rights defenders and emboldened authoritarian regimes. The United States, long the largest bilateral democracy donor, has effectively dismantled its global democracy support apparatus in a matter of months. These changes coincide with broader global aid reductions, as several Organization for Economic Co-operation and Development (OECD) donors also announced contractions to their foreign assistance, further widening the funding gap. The withdrawal of US democracy assistance represents a seismic shift in global development assistance and governance that is having far-reaching consequences for civil society, human rights and democratic institutions the world over. While organizations are demonstrating resilience, the scale of the funding gap to support civic infrastructure is unsustainable without renewed donor commitments. Investing in democracy is not a trade-off, but essential to long-term global stability and sustainable development.