The announcement of the dismantling of the United States Agency for International Development (USAID) has had a significant impact on Guatemala and the entire Central American region. This measure, promoted under the “America First” policy of the Trump administration and announced on February 3, 2025, by Elon Musk, director of the Department of Government Efficiency (DOGE), marks the end of an era in U.S. international cooperation.
Since its creation in 1961, USAID has been a key pillar in the implementation of development policies in Guatemala, allocating more than $2.421 billion in assistance between 2001 and 2024. These funds have been fundamental in strengthening areas such as education, health, security, humanitarian assistance, and economic development. With the abrupt suspension of the agency, hundreds of projects are left in uncertainty as the Guatemalan government seeks alternatives to fill the void left by this decision.
Economic and Social Impact of USAID’s Suspension in Guatemala
The closure of USAID not only represents a reconfiguration of U.S. foreign policy but also directly affects key sectors in Guatemala. According to data from the government site foreignassistance.gov, in 2024, USAID’s main areas of investment in the country included:
- Democracy, human rights, and governance: $49.15 million
- Economic development: $45.63 million
- Support programs: $29.78 million
- Humanitarian assistance: $27.59 million
- Health: $17.82 million
- Peace and security: $12.16 million
- Education and social services: $12.67 million
The sudden cut in these funds has affected programs focused on violence prevention, governance strengthening, and poverty reduction in rural and urban communities. Additionally, the agricultural sector, which benefited from initiatives such as the Sustainable Alliances for Innovation, Research, and Entrepreneurship (ASPIRE) Project, has been left vulnerable. This program, developed in collaboration with the Guatemalan Exporters Association (AGEXPORT), aimed to improve the value chains of products like cardamom, avocado, cocoa, and essential oils, enabling small producers to access international markets.
Similarly, the interruption of health programs has raised concerns among local organizations. Funds allocated to HIV treatment, chronic disease management, and prevention campaigns have been suspended, primarily affecting at-risk populations. In particular, the program run by Lambda, which worked on HIV prevention and care for the LGBTI+ community, has been impacted by misinformation spread by the Trump administration. The administration falsely claimed that USAID allocated $2 million for gender reassignment surgeries, while in reality, the funds were used to strengthen healthcare programs.
The New U.S. Cooperation Approach in Guatemala
During his recent visit to Guatemala, Secretary of State Marco Rubio met with President Bernardo Arévalo to discuss the restructuring of bilateral cooperation programs. In this meeting, it was agreed that the U.S. will continue to support efforts against drug trafficking, illegal human trafficking, border security, and irregular migration prevention.
However, Rubio made it clear that U.S. foreign assistance will be re-evaluated and aligned with the strategic interests of the country, meaning that many projects that previously received funding could disappear completely. During a meeting with USAID employees in Guatemala, the secretary expressed his stance on the agency:
“Foreign aid is the least popular thing the government spends money on. And I have spent a lot of time in my career defending and explaining it. But it is becoming increasingly difficult to do so across all areas.”
This suggests that the U.S. will prioritize projects related to security and migration control over social, educational, and community development initiatives.
The Closure of USAID and the Legal Battle in the U.S.
The dismantling of USAID has faced resistance in the U.S. Congress and from various civil society organizations. Since the agency was created by Congress in 1961, its closure cannot be executed solely by the Executive Branch.
On February 7, Federal Judge Carl Nichols issued a provisional order to halt the suspension of contracts for 2,200 USAID employees while evaluating the legality of the measure. Two federal employee unions have argued that Trump’s decision violates administrative procedures and requires Congressional approval.
Despite this legal setback, the Trump administration has maintained the suspension of cooperation funds, creating uncertainty about the agency’s future. The U.S. Congress is expected to debate the continuation of USAID in the coming months, which could determine the fate of U.S. international aid.
What’s Next for Guatemala?
With the suspension of USAID, Guatemala faces the challenge of reconfiguring its relationship with the United States and seeking new sources of funding for its social and economic programs. The Arévalo government has expressed its commitment to ensuring the continuity of urgent projects, but the lack of resources presents a significant challenge.
Economist Ricardo Barrientos, director of the Central American Institute for Fiscal Studies (ICEFI), warned about the implications of these cuts:
“There is an entire non-governmental sector that has complemented the deficiencies of the state. For example, in HIV care and other chronic diseases. These cuts highlight what the state is failing to address.”
Barrientos also noted that cooperation programs have enabled the existence of independent media and research centers, which would struggle to operate without financial support.
The closure of USAID in Guatemala represents a turning point in the country’s relationship with the U.S. and the model of international cooperation. While the Trump administration seeks to redirect funds toward security and migration control, Guatemala faces the challenge of compensating for the loss of resources in key sectors such as education, health, and economic development.
As the debate over USAID’s future unfolds in the U.S., Guatemala must explore new cooperation strategies with other international actors and strengthen its internal capabilities to ensure the well-being of its population. The outlook is uncertain, but what is clear is that the end of USAID marks the beginning of a new phase in diplomacy and foreign aid in the region.