Demise of USAID: A Setback to American Soft Power and an Opportunity for China
By Safwan Ali
It is still hard to imagine the abandonment of the 60-year-old, bipartisan-supported United States Agency for International Development (USAID). If you are wondering how an agency that worked for the development of other countries from U.S taxpayers’ money could be crucial for the U.S., it is imperative to understand that USAID has not merely been a charity in the wake of moral obligation. USAID has been a flagship project of American soft power and a key instrument of Washington’s foreign policy over the years. USAID has provided funding for activities designed to support education, protect human rights, tackle food insecurity, manage climate change, and boost global health initiatives, all accompanied by the powerful message “From the American People.” Under the ambit of development, USAID functioned as a great endeavour toward the global public good, which reinforced the American leadership role in the world. Washington has leveraged a great influence through these development projects. According to an archived post on the official website, which has since disappeared following the agency’s shutdown, “USAID would respond to an average of 75 humanitarian crises each year, including ongoing emergencies in Sudan, Afghanistan, Haiti, and the Middle East, new and emerging crises, and natural disasters.” These contributions have historically benefited U.S. interests abroad by increasing modernization and liberal norms in foreign societies, which has subsequently allowed countries to graduate from stable friends to key allies. South Korea, once ravaged by war, received USD 12.7 billion through USAID, established democracy, and went on to become a key partner of Washington.
However, the abrupt termination of aid poses a significant threat to vulnerable communities. It also creates a leadership vacuum that China is well-positioned to fill. The dissolution of USAID represents not just a setback for U.S. soft power but also an opportunity that China is unlikely to overlook, especially in light of ongoing shifts in U.S.-China competition.
To comprehend the significance of USAID in U.S. foreign policy, one must consider the historical context of its establishment. Following WWII, colonial powers like Great Britain and France dismantled their control over foreign territories. This resulted in several newly independent states with no governmental structure and a lack of sociopolitical stability. These dynamics provided both the Soviet Union and the U.S. with a great yet equal opportunity to spread their sphere of influence in the wake of the escalating Cold War. Meanwhile, in 1958, a political novel entitled “The Ugly American,” depicting a colonial image of the U.S became outrageously famous. Considering increasing Soviet influence and deteriorating American soft image, President Kennedy established USAID in 1961 as a soft power repairing tool. Although the original mandate of USAID was to consolidate foreign assistance – including money without loans – under one umbrella, Kennedy envisioned it as a non-military “source of strength” in American security strategy. Under the ambit of foreign assistance, USAID not only promoted global development but also acted as a useful instrument of diplomacy in countries that were severely under communist influence. For this reason, the vitality of USAID as a soft power tool became prominent even after the demise of the Soviet Union. The agency continued its work in the development sector, with a significant focus on Africa. The global rise of terrorism further necessitated the agency’s functionality, particularly in underdeveloped areas that are breeding grounds for terrorists such as Boko Haram, Al-Shabaab, and the Islamic State in West Africa (ISWA). The COVID-19 pandemic pushed USAID’s role further into global health. Ever since, USAID has done a remarkable job in improving public health in the developing world while maintaining the U.S.’s global presence.
China has also invested heavily in global development, and USAID’s sudden disbandment leaves the field open for Beijing. In the past twenty years, China has invested roughly one trillion dollars in international development initiatives, which include significant investments in infrastructure projects in Africa, Asia, and Latin America through both its Global Development Initiative and the Belt and Road Initiative. These projects include transportation networks, energy infrastructure, and industrial complexes, facilitating growth and trade in the Global South. However, contrary to the United States, much of Beijing’s development expenditure is on loans and other forms of funding rather than foreign aid or “assistance”. One can debate whether these investments constitute soft power, given that China’s development initiatives, unlike the U.S., are transactional rather than voluntary. However, considering China’s long-standing involvement in international development, the significance of Washington’s decision to shut down USAID is far greater than anticipated. Being a developing country, China has historically enjoyed a free ride under American leadership. While Washington’s aid contributed to the overall stability and development of impoverished communities, Beijing has leveraged this stability by expanding its lending for infrastructural development. Through this massive outreach, China has pushed itself to the forefront of power politics by leading associations like BRICS and other regional alliances. However, with the demise of USAID, the stability factor and the ability of these countries to pay back Chinese loans will be negatively affected. Therefore, it is likely that Beijing would be compelled to step into the open leadership role and provide the recipient countries a feasible alternative. In this context, the U.S. stepping down from its global leadership role while claiming to shift focus to the “East” will essentially result in a surrender of soft power at a time when it is particularly needed.
To conclude, the dissolution of USAID will severely diminish the United States’ strategic influence in the Global South, where China has already expanded its presence. As Washington pulls back from global development, it sends a signal of retreat that contradicts its efforts to compete with Beijing. This vacuum will not only allow China to consolidate its soft power but also reposition itself as the primary benefactor in regions historically aligned with the U.S.
Biography
Safwan Ali is a first-year graduate student at the Seton Hall School of Diplomacy and International Relations, specializing in International Security and Foreign Policy Analysis. Currently, He is a research assistant in the School of Diplomacy and an Associate Editor for the Diplomacy Journal. Safwan completed his bachelor’s degree in Defense and Strategic Studies from National Defence University, Islamabad.
