Uploaded May 2025 | Updated September 2026, 2 weeks ago
The dismantling of USAID by the Trump administration followed by the United Kingdom cutting its foreign assistance budget by 40% to pay for increased defence spending, highlights shifting strategic priorities at the cost of international development.
Australia has not followed suit in the latest budget as policy makers recognise Australia's strategic circumstances are different. More than 20 of Australia's regional neighbours are developing countries and thus Australia cannot vacate the field on development issues without significant strategic cost.
However, Australia cannot completely fill the gap left by the US withdrawal and with potentially 25% of all OECD donor aid estimated to be cut by 2027, this is a time of huge transformation for the development sector.
What comes next – and what should Australia's response be? How important is development as a tool for statecraft and why is it in Australia's interest?
The dismantling of USAID by the Trump administration followed by the United Kingdom cutting its foreign assistance budget by 40% to pay for increased defence spending, highlights shifting strategic priorities at the cost of international development.
Australia has not followed suit in the latest budget as policy makers recognise Australia's strategic circumstances are different. More than 20 of Australia's regional neighbours are developing countries and thus Australia cannot vacate the field on development issues without significant strategic cost.
However, Australia cannot completely fill the gap left by the US withdrawal and with potentially 25% of all OECD donor aid estimated to be cut by 2027, this is a time of huge transformation for the development sector.
What comes next – and what should Australia's response be? How important is development as a tool for statecraft and why is it in Australia's interest?
