Beyond USAID: Rethinking How the World Delivers Aid
When the U.S. Agency for International Development (USAID) was stripped of its independent mandate in July 2025—cutting more than 80% of its programs and staff—it left a vacuum in the global aid system. Commentators have been quick to suggest that the private sector could “replace” USAID. On paper, the idea sounds efficient. In reality, it’s far more complicated.
“Replacing USAID outright with private capital is a dangerous oversimplification. Contractors know better than anyone that boots on the ground, logistics, and political accountability can’t be outsourced to Wall Street. The future of aid has to be a partnership, not a hand-off.” 💼 Your overseas job search starts here
Impact investing and private finance are growing, with over $1.5 trillion in assets under management globally and annual growth of more than 20%. U.S. institutions like the International Development Finance Corporation (DFC) already deploy billions in blended finance to high-risk markets. But replacing USAID with business isn’t a one-for-one swap.
USAID’s role was never just about money—it was logistics, governance, and crisis management. Programs like FEWS Net, which tracked famine threats to deliver food aid with precision, have already been dismantled. Private philanthropy can’t replace those capabilities overnight, nor can it carry the same level of accountability to taxpayers or international law.
The more realistic path forward isn’t about replacement at all—it’s about transformation. Aid agencies should shift toward becoming connectors and enablers, funneling resources directly into local organizations and cash-first delivery systems. Private actors can be partners in this model, but they are not stand-ins for a government agency.
As aid systems undergo this transformation, the stakes are clear: millions of lives depend on moving beyond ideological debates and building resilient, locally empowered models that combine public oversight with private innovation.