The Trump administration’s funding freeze on USAID has left millions of dollars donated by European allies, including Sweden, Norway, and the Netherlands, in limbo. The $15 million contributed by these countries for joint development projects has been parked at USAID for months, with no clear indication of whether it will be disbursed or refunded.
The situation has raised concerns about Washington’s financial reliability and has strained relationships between the US and its allies. The European countries had partnered with USAID on a project called Water and Energy for Food (WE4F), which aims to help farmers in poorer countries develop sustainable agricultural practices.
Julia Lindholm, a spokeswoman for the Swedish government’s international development agency, expressed concerns about the impact of the funding freeze on the WE4F program. “It’s a concern for us, especially as we want our partner organizations to be compensated for the work they have put into the programs,” she said.
The funding freeze has also sparked worries about the humanitarian implications of the Trump administration’s policies. The WE4F program has benefited over 6 million farmers worldwide, and the disruption to the program could have devastating consequences for food security and poverty reduction efforts.
The Trump administration’s decision to cancel USAID contracts has also been criticized by former US officials, who argue that it undermines the country’s credibility as a reliable partner. The administration’s actions have been described as “destroying the United States’ credibility as a reliable partner” and “sending a message that this administration does not feel bound by those regulations — regulations on which every business that works with the United States relies.”
As the situation continues to unfold, the European countries are seeking clarity on the fate of their donations. Sweden’s development agency estimates that it has $12 million sitting in USAID accounts, including $5.1 million for WE4F. The Norwegian Agency for Development Cooperation and the Dutch Foreign Ministry have also reached out to USAID for information on their respective donations.
The incident highlights the need for transparency and accountability in international development funding. As Lindholm noted, “Donor partners are now exploring other opportunities to continue to run the WE4F programme to ensure a responsible completion.”
