Reductions in Foreign Aid and Their Effects on Life in Poorer Countries

20th January 2026

In recent years, a growing number of wealthy donor countries have reduced their foreign aid budgets, marking one of the most significant contractions in global development finance in over two decades.

These decisions reflect domestic fiscal pressures, rising defence and security spending, and shifting political priorities in donor states.

While such changes are often framed as budgetary necessities at home, their consequences are felt most acutely in poorer countries, where aid funding supports essential services such as healthcare, food security, education, and humanitarian protection.

The scale of these reductions is substantial. The United Kingdom has progressively lowered its aid spending from 0.7 per cent of gross national income to 0.5 per cent and plans to reduce it further to 0.3 per cent, resulting in an annual reduction of more than two billion US dollars compared with earlier commitments.

Germany has announced cuts amounting to approximately nine billion US dollars over recent budget cycles, including a sharp reduction in its development ministry's allocation.

France has reduced its aid budget by more than two and a half billion US dollars across recent years, reversing a period of steady expansion.

The Netherlands has announced planned reductions of several hundred million dollars by the latter half of the decade, while Belgium is expected to cut roughly eight hundred million dollars from its aid envelope.

Sweden has reduced development spending by several hundred million dollars per year as it shifts funds toward domestic and regional priorities, and Finland has announced a reduction of around a quarter of its aid budget, amounting to hundreds of millions of euros. Even traditionally generous donors such as

Norway have made more modest reductions, though Norway remains among the few countries still meeting the long-standing 0.7 per cent aid target.

The United States represents a particularly large source of disruption. Funding freezes, programme cancellations, and administrative changes affecting USAID have resulted in the suspension or termination of a majority of its overseas programmes, creating funding gaps that run into the tens of billions of dollars over multiple years.

While some assistance continues, especially in strategically prioritised regions, the scale and speed of the reductions have left major shortfalls in humanitarian and development funding worldwide.

These budget decisions translate directly into reduced or discontinued programmes on the ground. Health systems are among the most immediately affected. Cuts to donor-funded HIV/AIDS programmes in parts of sub-Saharan Africa have threatened continuity of antiretroviral treatment and prevention services.

Maternal and child health programmes supported by UK, US, and European funding have been scaled back in countries such as Ethiopia and Afghanistan, leading to clinic closures, staff losses, and reduced outreach in rural areas.

Multilateral health institutions, including the World Health Organization and UNICEF, have reported large funding gaps, affecting vaccination campaigns, disease surveillance, and basic healthcare provision.

Food security programmes have also been heavily affected. The World Food Programme has reduced rations and narrowed coverage in countries such as Yemen, Nigeria, and refugee-hosting states in East Africa as donor contributions have fallen.

Nutrition programmes targeting children and pregnant women have been scaled back, and school feeding schemes have been suspended in some regions. While these reductions do not usually result in immediate famine, they significantly increase chronic hunger and malnutrition, especially among the poorest households.

Education and social protection programmes are often among the first to be cut because they are not classified as life-saving in the short term. Donor-funded scholarships, cash transfers, teacher training initiatives, and child protection services have been reduced in multiple low-income and conflict-affected countries. In practice, this leads to higher dropout rates, increased child labour, and greater pressure on girls to leave school permanently, reinforcing long-term poverty and inequality.

Fragile and conflict-affected states experience the most severe consequences. In places such as Yemen, Somalia, parts of the Sahel, and Afghanistan, foreign aid supports functions that resemble basic state services.

When funding is withdrawn, service gaps are often filled by armed groups, informal networks, or criminal organisations, increasing insecurity and instability. Aid reductions in these contexts also contribute to displacement and migration pressures, which can have regional and global repercussions.

At the household level, the burden of reduced aid is absorbed by families themselves. Women typically shoulder increased unpaid care work when health and nutrition services decline. Families sell assets, take on debt, or pull children out of school to cope with rising costs and lost support. These coping strategies protect immediate survival but undermine long-term economic prospects and social mobility.

A further, less visible consequence of aid reductions is the weakening of local institutions. Many aid programmes fund local NGOs, community health workers, and civil society organisations. When funding ends abruptly, trained staff leave, institutional capacity is lost, and trust built over years erodes. This undermines donor objectives around sustainability and local ownership and makes future interventions more costly and less effective.

Importantly, aid cuts rarely cause sudden collapse. Hospitals do not close overnight, and food systems do not immediately fail. Instead, services become thinner, less reliable, and more unequal. Progress achieved gradually over decades in health, nutrition, and education is slowly reversed. For people living in poverty, this is experienced not as a single crisis but as a steady erosion of security and opportunity.

In conclusion, the recent wave of foreign aid reductions by major donor countries represents a significant shift in the global development landscape.

While these decisions are shaped by domestic political and economic pressures, their effects extend far beyond national borders. Reduced aid funding is reshaping everyday life in poorer countries, increasing vulnerability, weakening institutions, and reversing hard-won gains in human development.

Understanding both the financial scale of these cuts and their human consequences is essential for informed debate about the future of international aid and global responsibility.

Have the cuts caused famine in any areas?

In some regions the reduction in foreign aid has contributed to conditions that meet the international definitions of famine or near-famine, and in other areas it has sharply worsened hunger and malnutrition, though aid cuts are usually one factor among many (conflict, climate shocks, economic collapse, displacement). Here's the clearest picture based on recent UN and humanitarian reporting:

Regions where famine or famine-like conditions have been reported
Sudan

Parts of Sudan — especially Darfur and Kordofan — were classified as experiencing famine (IPC Phase 5) while aid was drastically reduced. Ongoing cuts in funding for food assistance and health services left millions without vital support. Conflict and displacement amplified the impact of aid reduction, and famine conditions were documented in several areas.

Gaza Strip

In early 2025, the humanitarian blockade and interruptions in food aid caused conditions that met famine thresholds in parts of Gaza, with acute malnutrition rates rising sharply and deaths from starvation reported. Subsequent improvements in aid access helped pull some areas back from official famine classification, but severe food insecurity remains widespread and fragile.

Severe hunger conditions linked to aid shortfalls

Even where formal famine is not declared, aid cuts have pushed millions into emergency levels of hunger (IPC Phase 4) and near-famine conditions in multiple countries:

Afghanistan

Reduced food assistance means many Afghans face severe hunger, with the World Food Programme unable to reach most people who need help, and malnutrition projected to rise sharply.

West and Central Africa

In Nigeria, the Sahel, Chad, Cameroon and Niger, sharp reductions in humanitarian funding have pushed acute hunger to record levels, with some local populations at risk of catastrophic food shortages and sharply reduced aid coverage.

Haiti

Violence limiting aid access and reduced humanitarian funding have contributed to an escalating hunger crisis, with large displacement and acute food insecurity.

Somalia, South Sudan & DRC

WFP and other agencies report that aid cuts are forcing ration reductions and shrinking the number of people served in countries already experiencing chronic hunger.

Aid cuts rarely alone cause famines — famine is typically declared when several factors converge:

widespread lack of access to food

extremely high acute malnutrition

mortality rates exceeding a threshold

Aid reduction is often a critical contributor but works alongside conflict, economic collapse and climate shocks to push areas into famine or near-famine conditions. For example, in Sudan and Gaza, food assistance cutbacks coupled with war and economic breakdown created situations where food became inaccessible to much of the population.