Shockwaves in Dhaka: Trump Freezes Foreign Aid Leaving Bangladesh in Limbo

Washington D.C. - In a move that has sent ripples through the international community, President Donald Trump signed an executive order on January 20, 2025, imposing a 90-day pause on all U.S. foreign development assistance. This decision mandates an immediate cessation of new obligations and disbursements by all relevant departments and agencies, pending a comprehensive review of their alignment with American interests and values.

Bangladesh in the Crosshairs

The impact of this directive is acutely felt in Bangladesh. The United States Agency for International Development (USAID) promptly instructed its partners in the country to suspend all activities under existing agreements. This suspension affects a broad spectrum of programs, including those targeting food security, health initiatives, education, environmental projects, and humanitarian assistance related to the Rohingya refugee crisis.

Economic and Social Repercussions

For Bangladesh, the halt in USAID funding presents significant challenges. International aid has been pivotal in addressing economic difficulties, managing the Rohingya crisis, and stabilizing key industries such as textiles. In 2024 alone, the U.S. committed $202 million in aid to Bangladesh, part of a larger pledge of $954 million between 2021 and 2026, with $425 million already disbursed.

A Global Reassessment

This suspension is part of a broader strategy by the Trump administration to reevaluate foreign aid programs. An internal memo from the State Department has ordered an immediate halt to virtually all existing foreign aid programs, pending a review to ensure consistency with the administration's policies. Exceptions have been made for military financing to Israel and Egypt, as well as emergency food assistance.