ICTworks

USAID accounts for nearly two-thirds of the reported decline in U.S. foreign-assistance payments between FY2025 and FY2026. Health lost the most dollars. Democracy, human rights, and governance lost the largest proportion of its funding.

Moving USAID’s remaining programs to the State Department did little to preserve the combined flow of assistance.

That is the picture emerging from preliminary U.S. foreign-assistance payment data. Reported disbursements fell from $47.84 billion in FY2025 to $11.75 billion in FY2026. Approximately $36 billion less reached the payment stage, a decline of 75%.

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USAID’s Funding Did Not Simply Move to State

USAID’s reported payments fell approximately 95%, from $24 billion to $1 billion. State’s payments also fell, from $16 billion to $9 billion. Together, they account for approximately 83% of the total dollar decline in the report’s managing-agency breakdown.

That combined figure matters more than either agency’s name above the door. GAO confirms that State assumed USAID’s remaining functions. Yet the payment decline across both agencies shows how little the administrative transfer explains the overall contraction.

Agency transfers complicate comparisons. GAO confirms that State assumed USAID’s remaining functions. Yet their combined reported payments fell from approximately $40 billion to $10 billion. Moving awards between those two agencies cannot, by itself, explain that reduction. 

For international development organizations, replacing “USAID” with “State Department” in the business-development plan is therefore a weak response. The combined funding channel is substantially smaller.

It is also more concentrated. State accounts for about 77% of remaining reported FY2026 payments, compared with approximately 34% in FY2025. Its award administration and priorities consequently deserve closer attention, but those figures offer no assurance that a terminated digital development project will find a successor award.

The alternative federal channels also require scrutiny. Treasury’s department-wide payments fell approximately $1.84 billion, while Millennium Challenge Corporation payments fell about $440 million. Neither should automatically count as an unaffected replacement market.

We have a more concentrated aid system with substantially less money moving through it.

Health Lost the Most Money.

The sector figures show where the same contraction falls across development work. They are another view of the agency totals, so the two tables should not be added together

Health lost approximately $7.28 billion, the largest dollar reduction. Humanitarian assistance lost another $5.12 billion. Together, those sectors account for roughly $12.41 billion in reduced payments.

Those two categories still received the largest remaining amounts. That makes them look comparatively protected on a chart. Consider the absolute losses, however, before describing either as a funding refuge.

A humanitarian organization facing a 57% sector-wide contraction is operating in a very different funding environment, even if another sector suffered a larger percentage decline. Health’s remaining $3.65 billion likewise sits beside a loss twice that size.

Economic development payments fell about 85%, to $1.27 billion. For teams working on digital finance, agritech, enterprise support, or employment services, that is a reason to reassess the funding assumptions behind each opportunity. An unchanged pipeline forecast is difficult to defend. 

Democracy, human rights, and governance fell approximately 95.5%, leaving just $76 million in reported payments. Civic technology, accountability, and digital rights practitioners should recognize the severity of that sector-wide contraction. Almost the entire reported funding base has disappeared.

Peace and security also contracted almost completely, falling 94%, with approximately $7.04 billion less in reported payments. The smaller categories add to the breadth of the loss: multisector payments fell 89%, environment 75%, and education and social services 57%. Program support lost approximately $4.56 billion, down 74%.

Military Aid explains only a minority of the decline. Military-objective assistance fell from approximately $6.29 billion to $100 million. That accounts for about 17% of the total dollar reduction. Assistance classified by an economic objective accounts for the other 83%.

USADF shows an active grant can still be unfunded. The U.S. African Development Foundation provides a particularly sharp warning. A USADF official told GAO that its active grant count had not changed as of May 2026, yet the agency had been unable to pay grantees since January 2025.

In our discussion of locally led development, we examined ways to make USAID procurement more accessible to local organizations. Access to an award and access to its money are separate achievements. USADF’s experience shows why we must ask about both.

What Does the Future Hold?

ICTworks previously called for documenting the effects of the aid freeze. These figures sharpen that task. Health has the largest dollar loss; governance has nearly lost its funding base; multiple alternative agencies have also contracted.

Which of these losses is doing the most damage in your country, and what has stopped as a result?