IV Macro Policy & Sovereign Debt Middle East and North Africa

The human and political cost of US aid cuts across the Arab world

Institution: Arab Center Washington DC
Author: Yara M. Asi
Country · language: US (Arab perspective) · English
Affiliation: Independent non-profit

Summary

Asi argues that the abrupt and unplanned US cuts to foreign aid are causing preventable deaths in the region's fragile societies. According to the data she cites, UNFPA was cut by 377 million dollars; the US funded 60 per cent of the agency's operations in Yemen. In Yemen 21 million people depend on external aid; the US gave Yemen 768 million dollars in 2024, half of the humanitarian response. Since the start of 2025, 453 health facilities have closed in Yemen.

In Syria more than 16 million people need humanitarian assistance, and an initial cut of 237 million dollars was made. UNRWA funding was halted entirely. The author's most striking finding is that almost all the cuts fell on economic, development and humanitarian aid, while military aid to Egypt and Israel continues. The mortality projections in the piece rest on models and could not be independently verified.

Blind spot

What the West misses: the Hormuz and war agenda overshadows the collapse of development aid in the region and the medium-term instability risk it creates. Weakness of this reading: the source of the mortality projections is not assessed in detail, and the extent to which Gulf donors are filling the gap is not addressed.

Talay assessment

Bottom line

Asi's central finding is persuasive: the cuts are concentrated in economic, development and humanitarian aid while military aid to Egypt and Israel continues, which shows the US narrowing its regional presence to a security-first profile. Because the mortality projections rest on models, the scale is uncertain, but the direction is tangible: 453 health facilities have closed in Yemen. Something the piece does not address, Gulf donors fully filling the gap, looks unlikely given budgets strained by the war and export disruptions. The most likely path is a gap that stays partly open, with humanitarian deterioration in Yemen and Syria turning into migration pressure.

Likely effects

Humanitarian situation in YemenNegativeWeeks
The 377 million dollar cut to UNFPA and closing health facilities are narrowing access to basic services for the 21 million people dependent on external aid. Combined with renewed fighting, displacement waves such as flight across the Red Sea to Djibouti are growing.
US regional influenceNegative6 months+
Withdrawing development and humanitarian aid while preserving military aid erodes US soft power among the region's societies. The vacuum opens political space for other donors offering conditional aid and reduces Washington's mediation capital in moments of crisis.
UN agencies and UNRWANegative1–6 months
The complete halt to UNRWA funding and the UNFPA cut are forcing agencies to close programmes and triage priorities. The first affected are Palestinian refugees and those relying on maternal and child health services in Yemen.
TürkiyeNegative1–6 months
The 237 million dollar cut, at a time when more than 16 million people in Syria need aid, adds to the humanitarian burden inside the country. That burden may feed through to migration pressure in the border region and to operational costs borne by Turkish aid organisations.

Possibilities, ranked

1
Gap stays partly open, humanitarian deterioration continues65%
US cuts become permanent and Gulf and European donors offer only selective contributions. Health and nutrition services in Yemen and Syria keep contracting and displacement rises.
Watch: Funding rates of the UN humanitarian response plans for Yemen and Syria; new notices of health facility closures
2
Gulf donors step in on political terms20%
Saudi Arabia and the UAE increase funding in areas aligned with their own security priorities; coverage stays narrow and aid becomes a tool of regional rivalry.
Watch: New Saudi and UAE funding pledges to UN agencies or to Yemen
3
Partial US reversal15%
Under congressional pressure or on security grounds, some humanitarian programmes are refunded on a limited scale; items other than UNRWA see a partial recovery.
Watch: UNFPA and humanitarian aid lines reappearing in US appropriations bills

Probabilities are calibrated judgement based on the sources, not measurement, and are revised as new information arrives. Not investment advice.

Original publication: arabcenterdc.org · 10 September 2026

This page summarises the institution's view and does not reflect the view of Talay Insight. No direct quotation is used.