Rubio Shifts US Foreign Aid to Direct Government Partnerships

In December 2025, Secretary of State Marco Rubio stood beside Kenyan President William Ruto and signed a document that represents the most radical transformation of U.S. foreign assistance in a generation. The $2.5 billion, five-year health cooperation agreement with Kenya — the first of up to 50 planned bilateral deals — inaugurated a new era in which Washington will bypass the sprawling network of NGOs and contractors that have delivered American aid for decades, instead sending money directly to foreign governments [1][2].

The shift follows the effective dissolution of the United States Agency for International Development, the cancellation of 83 percent of its programs, and a policy framework called the "America First Global Health Strategy" that its architects say will end dependency and waste. Critics counter that it funnels billions to governments with documented corruption problems while an estimated 500,000 to one million people may have already died from the abrupt disruption in lifesaving health programs [3][4].

The End of USAID as We Knew It

The transformation began within days of Secretary Rubio's confirmation in January 2025, when he ordered a halt to nearly all U.S. foreign aid pending a review [5]. By March, he announced that 5,200 USAID contracts — representing 83 percent of the agency's portfolio — had been cancelled following what he described as a six-week review that uncovered programs that "did not serve, and in some cases even harmed, the core national interests of the United States" [6].

Current and former officials at USAID and the State Department told NPR that the review was far from thorough, describing it as a "surface level" keyword search of program descriptions rather than a genuine assessment of impact [6]. On July 1, 2025, USAID officially ceased operations. Its remaining functions were absorbed by the State Department, which quickly rehired approximately 800 former USAID career officials on temporary contracts to help manage the transition [7].

The scale of the disruption is staggering. U.S. foreign aid spending plummeted from $68 billion in fiscal year 2024 to approximately $32 billion in 2025 — a decline of more than 50 percent [8]. The Trump administration's initial budget request for fiscal year 2026 would have cut foreign affairs spending by 85 percent, though Congress ultimately passed a $50 billion foreign aid bill in February 2026, restoring some funding while still representing a 16 percent cut from 2025 levels [9].

Source: ForeignAssistance.gov / NPR / The Conversation

Data as of Mar 10, 2026CSV

The "America First Global Health Strategy"

The administration's replacement framework, unveiled in September 2025, represents a philosophical inversion of how the United States has delivered foreign assistance for more than six decades [10]. Rather than channeling funds through American and international NGOs — organizations like World Vision, CARE, and Doctors Without Borders that have served as the primary implementing partners for U.S. global health programs — the strategy calls for direct, bilateral agreements with recipient country governments.

The stated objectives are threefold: protecting the U.S. homeland by preventing infectious disease outbreaks, strengthening bilateral relationships through multi-year agreements that require co-investment from partner governments, and promoting American health innovation abroad [10]. The strategy focuses specifically on HIV/AIDS, tuberculosis, malaria, polio, and global health security — the areas where U.S. investment has historically had the most measurable impact.

"This isn't a handout," a senior administration official told Foreign Policy. "This instead is a joint venture between the U.S. and the government in another country," designed to build local capacity and shift responsibility over time [7].

The transition has been shaped in part by a small group of former officials advising the White House from the private sector, including former USAID administrator Mark Green and former lawmakers Ted Yoho and Chris Stewart, who have pushed for stricter accountability standards and tighter performance metrics [11].

The Kenya Deal: A Template for the Future

The agreement signed with Kenya on December 4, 2025, serves as the administration's proof of concept. Under its terms, the United States will provide more than $1.6 billion over five years to Kenya's health system, while the Kenyan government has pledged to increase its own health spending by $850 million over the same period — a significant co-investment commitment that the administration says distinguishes the new approach from traditional aid [1][2].

The deal focuses on combating HIV/AIDS, malaria, and tuberculosis, with a notable emphasis on faith-based medical providers, though all clinics and hospitals enrolled in Kenya's national health insurance system are eligible to receive funding [2]. Crucially, the Kenyan government will directly manage the funds and implementation of programs — a dramatic departure from the previous model in which American NGOs and contractors oversaw spending on the ground.

UNAIDS welcomed the agreement, calling it a potentially positive step toward country ownership of health programs [12]. But questions emerged almost immediately. Kenya's Daily Nation reported concerns about provisions requiring Kenya to share health data access with the United States, with critics calling aspects of the deal "lopsided" [13]. Global health experts noted that Kenya, while considered one of sub-Saharan Africa's more stable governments, still faces significant governance challenges in its health sector.

Source: World Bank World Development Indicators

Data as of Mar 10, 2026CSV

The Corruption Question

The most pointed criticism of the direct-government-partnership model centers on corruption risk. The case of Equatorial Guinea illuminated the tension at the heart of the approach.

In November 2025, Senator Jeanne Shaheen, the ranking Democrat on the Senate Foreign Relations Committee, revealed that the administration had made a $7.5 million direct payment to the government of Equatorial Guinea — one of the world's most authoritarian regimes — in exchange for the country agreeing to accept third-country nationals deported from the United States [14].

The payment was extraordinary by any measure. Over the previous two administrations, U.S. foreign assistance to Equatorial Guinea had never exceeded $2 million annually and had only been provided through vetted nongovernmental partners, never directly to the government [14]. The State Department's own 2025 Trafficking in Persons Report documented "corruption and official complicity in trafficking crimes" by Equatorial Guinean officials, with multiple credible sources alleging senior officials' involvement in human trafficking [14].

Shaheen demanded to know "whether there are guardrails in place to ensure funds do not facilitate corruption, human trafficking or human rights abuses." The State Department declined to comment on the arrangement, citing a desire not to reveal details of "diplomatic communications" [14].

For critics, the Equatorial Guinea episode represents exactly the risk inherent in eliminating the NGO intermediaries that, for all their imperfections, provided a layer of accountability between U.S. taxpayer dollars and foreign government treasuries.

The Human Cost of Transition

Whatever the long-term merits of the new approach, the transition itself has been devastating. The abrupt cancellation of thousands of aid contracts created immediate gaps in lifesaving health services across the developing world.

The Center for Global Development estimates that the decline in U.S. aid spending in 2025 may have resulted in 500,000 to one million lives lost — with HIV/AIDS accounting for approximately 675,000 additional deaths and malaria and tuberculosis combining for an estimated 285,000 more [3]. PEPFAR, the landmark HIV/AIDS program launched by President George W. Bush, saw 77 percent of its health awards terminated. The number of people receiving U.S.-funded HIV testing and counseling dropped from 84 million in 2024 to 67 million — a loss of 17 million people [3].

A study published in The Lancet in February 2026 projected that if current funding trends continue, global aid cuts could lead to at least 9.4 million additional deaths by 2030, including 2.5 million children under age five [15]. Under a more aggressive rollback scenario, the figure rises to 22.6 million deaths, including 5.4 million young children.

The impact on implementing organizations has been equally severe. As of April 2025, 81 NGOs had closed at least one office. World Vision, the world's largest evangelical humanitarian organization, lost 10 percent of its budget, laid off up to 3,000 employees, and cut programs addressing HIV/AIDS prevention, child health, and malnutrition in countries including Bangladesh, Kenya, and Rwanda. Search for Common Ground, a conflict-resolution organization, lost $23 million overnight — 40 percent of its budget [8].

A Geopolitical Vacuum

The U.S. retreat from its traditional aid architecture has not gone unnoticed by strategic competitors. In the months following USAID's dissolution, China took visible steps to expand its influence in the spaces Washington vacated. When a major earthquake struck Myanmar in April 2025, China pledged $137 million in aid compared to approximately $9 million from the United States. In May 2025, China announced a $500 million donation to the World Health Organization [16].

However, analysts caution against oversimplifying the dynamic. China did not significantly increase its overall foreign aid spending in 2025, and experts note that Beijing cannot — and likely does not intend to — replace the decades-old American aid infrastructure [16]. What is striking, as NPR observed, is that the two superpowers appear to be converging: the United States is moving toward the kind of direct government-to-government model that China has long favored, while China has begun emphasizing smaller, more targeted "small and beautiful" projects [16].

The OECD estimates an overall decline in overseas development assistance in 2025 of 9 to 17 percent globally, with sub-Saharan Africa experiencing a 16 to 28 percent decline. Health funding specifically could drop by up to 60 percent from its 2022 peak [3].

Congressional Pushback and the Path Forward

The bipartisan $50 billion foreign affairs bill passed by Congress in February 2026 represented a rebuke of the administration's most extreme proposals. The package included $9.4 billion for global health programs, $5.4 billion for humanitarian aid, and funding for education, nutrition, agriculture, democracy support, and embassy operations [9]. It was nearly $20 billion above the president's initial budget request.

But the bill also implicitly accepted the new architecture. Congressional debate centered not on restoring USAID but on ensuring adequate oversight of the bilateral agreement model. Former USAID career officials writing in Foreign Policy urged Congress to add guardrails in future appropriations legislation, including requirements for risk assessments, the use of official bank accounts and civil service systems, minimum staffing requirements for planning and oversight, and specific timelines for building recipient countries' capacity to manage funds [7].

The State Department has said it aims to finalize agreements with the largest recipient countries by the end of March 2026, with full implementation beginning in April. More than a dozen bilateral agreements have reportedly been signed, though the administration has released limited details about deals beyond the Kenya framework [17].

A Gamble with Global Consequences

The transformation of U.S. foreign assistance under Secretary Rubio represents a genuine ideological shift, not merely a budget cut. The administration believes that decades of funding through NGO intermediaries created a bloated ecosystem that enriched contractors while fostering dependency in recipient countries. The new model, they argue, treats partner nations as equals rather than charity cases, requiring them to invest their own resources and take ownership of outcomes.

The counterargument is equally forceful: the NGO model, for all its flaws, was built over decades precisely because direct government funding in many developing countries leads to corruption, mismanagement, and the diversion of resources away from the most vulnerable populations. The abrupt transition — rather than a phased reform — has already cost lives that may never be fully counted.

The stakes extend far beyond health. U.S. foreign assistance has historically served as a tool of soft power, building goodwill, strengthening alliances, and countering the influence of rivals like China and Russia. Whether the bilateral agreement model can serve these strategic functions as effectively as the network it replaced remains one of the defining foreign policy questions of the Trump administration's second term.

As the State Department races to finalize dozens of bilateral deals before its self-imposed April deadline, the world is watching an unprecedented experiment in how the wealthiest nation on Earth chooses to engage with the poorest — and what happens when the rules of that engagement are rewritten virtually overnight.