Dismantling USAID could boost African self-reliance

Back in 2015, then-Kenyan President Uhuru Kenyatta warned the Pan-African Parliament about the dangers of development assistance. “The future of our continent cannot be left to the good graces of outside interests,” he said. “Foreign aid, which often comes with terms and conditions that preclude progress, is not an acceptable basis for prosperity and freedom. It is time to give it up.”

Kenyatta’s call for self-reliance seems prescient in light of US President Donald Trump’s dismantling of the US Agency for International Development and recent cuts to already-diminished foreign aid budgets in France, Germany and the UK. He had a point: as aid dependence became more entrenched over the decades, Africa’s share of global trade steadily fell. It now stands at less than 3 percent. National ambitions to build productive industries that can meet domestic demand have atrophied and continent-wide efforts to strengthen regional integration have waned.

That is why, despite the disproportionate impact of these cuts on the continent, some Africans see the demise of foreign aid as an opportunity. An Afrobarometer survey of 34 African countries found that 65 percent of respondents wanted their governments to finance development with their own resources, rather than with external loans.

Self-reliance was an aspiration of independence leaders such as Kwame Nkrumah, Ghana’s first president and a co-founder of the Organization of African Unity (a forerunner of the African Union), who viewed the foreign aid system as a form of neocolonialism. Current Ghanaian President John Dramani Mahama has taken up the cause, calling the destruction of USAID “a signal to Africa that the time has come for us to be more self-reliant.”

Africa’s muted response contrasts sharply with the dire predictions of development professionals in Western capitals, who are warning that a humanitarian catastrophe will soon unfold on the continent. According to Nicholas Enrich, formerly USAID’s acting assistant administrator for global health, gutting the agency would result in an additional 71,000 to 166,000 deaths per year from malaria and 1 million children annually with untreated severe acute malnutrition, among other harmful consequences.

True, Africa has long depended on foreign aid not just for short-term emergency relief but also for critical health funding. The US President’s Emergency Plan for AIDS Relief and the President’s Malaria Initiative, decades-old programs created by US President George W. Bush, have been instrumental in combating HIV/AIDS and malaria, which are disproportionately prevalent in Africa. About 67 percent of people living with HIV worldwide reside in sub-Saharan Africa and the continent accounts for more than 90 percent of malaria cases and deaths.

Africa has long depended on foreign aid not just for short-term emergency relief but also for critical health funding

Hippolyte Fofack

This aid is not confined to Africa’s neediest and most vulnerable countries, such as the Central African Republic, Somalia and South Sudan, where official development assistance accounts for more than 20 percent of gross national income. Even Nigeria and South Africa, two of the continent’s largest economies, rely heavily on USAID programs. The US President’s Emergency Plan for AIDS Relief funds nearly 20 percent of South Africa’s $2.3 billion annual HIV/AIDS program, providing life-saving antiretroviral treatments to 5.5 million people every day. And the President’s Malaria Initiative’s support comprises about 21 percent of the national health budget in Nigeria, which has the world’s highest burden of malaria.

African countries’ dependence on the US for public health expenditure poses a national security risk, as vaccine nationalism during the COVID-19 pandemic made clear. It also implies massive governance costs. A 2023 study showed that foreign aid tends to weaken fiscal capacity in African democracies. These governments may become less accountable to their citizens and more autocratic, propped up by official development assistance.

Foreign aid precludes economic progress precisely because of its “terms and conditions,” as Kenyatta put it. The aid industry in Africa runs largely on foreign contractors, limiting opportunities for African entrepreneurs and undercutting local growth. This constrains the expansion of governments’ very narrow fiscal space, sustains persistently high unemployment rates and fuels migration pressures. Even South Africa, the continent’s most advanced economy, has an unemployment rate exceeding 30 percent.

In the wake of the White House’s assault on USAID, Africa should put itself on a path toward health self-sufficiency. That means taking more control over the response to HIV/AIDS and malaria, from research and development to manufacturing diagnostics and treatments, rather than relying on extra-regional solutions and imports. To mitigate the risks of aid dependence and to bolster economic growth, African countries must take advantage of the opportunities inherent in health crises and unleash the animal spirits of local entrepreneurs. The Nigerian government has already approved an additional $200 million in health spending as part of its 2025 budget and other countries are contemplating similar increases.

African countries must take the same approach to other strategic sectors, especially nutrition security, because overreliance on foreign aid-funded food imports harms African farmers by distorting markets and depressing local prices. The continent needs fair trade, not aid. With an estimated 60 percent of the world’s uncultivated arable land, Africa should not be dependent on external suppliers to feed itself.

To be sure, African governments with limited fiscal space and poor access to international markets may not be able to build the infrastructure required to drive domestic production. This problem can be solved by pooling resources with other countries to develop productive infrastructure and resilient regional supply chains, thus boosting intra-African trade and deepening regional integration. India is an example of what can be achieved. After all, its world-beating and uber-price-competitive generic drug industry began to take off long before India’s national economy did.

Achieving economies of scale through the African Continental Free Trade Area could help crowd in private capital to build up critical industries. This would enable Africa to expand aggregate output and increase trade levels, both of which have remained dismally low.

The US’ attack on development assistance can be the wake-up call African leaders need. After decades of lowering ambitions and outsourcing development, it is time for the continent to take full advantage of the growth opportunities associated with domestic crises, rather than ceding control to the aid system and the foreign contractors that fill its ranks. Necessity is the mother of invention, as the cliche goes, which means that the end of USAID could galvanize African governments to confront their countries’ challenges head-on.

• Hippolyte Fofack, a former chief economist and director of research at the African Export-Import Bank, is a former World Bank economist, a research associate at the Harvard University Center for African Studies, and a fellow at the African Academy of Sciences. ©Project Syndicate