Trump Administration Considers Shifting USAID Funding to Private-Sector Investments
Washington, D.C. - President Donald Trump's advisors are exploring a restructuring of the United States' international economic influence, including the potential diversion of billions in funding from the United States Agency for International Development (USAID).
This proposed shift would prioritize private equity, hedge funds, and other investors in economic projection efforts, reflecting a growing focus on private sector development in foreign assistance.
Key Points:
* USAID funding could be reallocated to the US International Development Finance Corp. (DFC), an organization that leverages taxpayer funds to invest alongside private investors in overseas projects.
* Ben Black, a dealmaker and son of Apollo Global Management co-founder Leon Black, has been nominated to lead the DFC and has outlined ideas for enhancing its role.
* Secretary of State Marco Rubio and some advisors support reducing USAID funding and empowering the DFC.
* The Trump administration aims to utilize the DFC as a strategic instrument for economic power, focusing on critical minerals and resource projects aligned with US interests.
* Congressional reauthorization of the DFC is necessary for the proposed changes, with bipartisan support for expanding its mandate and investment capacity.
* Republican Senator Steve Daines supports the concept of shifting resources from USAID to the DFC.
* Conservative Republicans have long advocated for transitioning from traditional humanitarian aid to private sector investment in developing countries.
The administration continues to consider various options, and the timeline for implementing these plans remains unclear. Congressional approval from both Democrats and Republicans may be necessary, as the funding for USAID and the DFC originates from the same federal budget account.
Background:
* Elon Musk has previously advocated for shutting down USAID, a move supported by President Trump.
* The DFC was established during the first Trump administration with the mandate to invest in private sector projects alongside institutional investors.
* Ben Black and conservative influencer Joe Lonsdale have proposed shifting much of USAID's budget to the DFC, arguing for a more investment-driven approach to foreign aid.