The United States has announced that, from July 1, 2025, it will end its charity-based foreign aid model in Africa, Latin America, and other developing regions, shifting to an investment-driven approach aligned with its strategic interests.
The announcement was contained in a statement signed by Secretary of State Marco Rubio, which said the Department of State will take over foreign assistance from USAID to deliver aid with greater accountability, efficiency, and impact.
The U.S. described the previous aid model as ineffective, saying it created dependency as many governments had “developed an addiction” to assistance.
It noted that developing countries now prefer trade and investment over indefinite support, and future aid will be time-bound, targeted, and tied to reforms that promote self-reliance and attract private investment.
“As of July 1st, USAID will officially cease to implement foreign assistance. Foreign assistance programs that align with administration policies—and which advance American interests—will be administered by the State Department, where they will be delivered with more accountability, strategy, and efficiency,” the statement read in part.
It added, “Equally importantly, the charity-based model failed because the leadership of these developing nations developed an addiction. State Department research finds the overwhelming sentiment in countries formerly receiving USAID funding is for trade, not aid. After engaging with nations across Latin America and Africa, we have consistently heard that developing countries want investment that empowers them to sustainably grow, not decades of patronizing UN or USAID-managed support.”
Rubio noted that despite more than $165 billion in aid to sub-Saharan Africa since 1991, the region aligned with the U.S. on only 29 percent of key United Nations votes in 2023, which the U.S. described as one of the lowest rates globally.
More insights
The statement explained that U.S. assistance will now prioritize countries that show both the willingness and capacity to implement self-sustaining reforms.
Future funding will be focused, limited in duration, and aimed at attracting private and international investment, including from American companies.
- This policy shift also serves as a response to China’s expanding influence in developing regions, where Beijing’s infrastructure-led aid has gained ground. In contrast, the U.S. intends to promote economic opportunity rather than dependency, and long-term investment instead of indefinite assistance.
- All U.S. aid will now be clearly marked with the American flag to reflect its source, ending the practice of channeling support through unbranded third-party NGOs.
The statement highlighted that the reform, which began with a review of more than $715 billion in past aid spending under the Trump Administration, is described as one of the most significant overhauls of U.S. development strategy in recent decades.