forklift truck with boxes on pallet marked health care and medicine aid (Photo by iStock/ugurhan)

This is the first article in an SSIR series authored by T. Alexander Puutio and other global development experts and leaders on how the sector can chart a path forward in the face of government pullbacks.

Since the establishment of the first modern development agencies in the mid-20th century, the very concept of global development has never been tested like it’s being tested now. Even during recessions and upheavals, global development always followed a consistently forward trajectory, with an understood commitment to equity, dignity, and shared prosperity. Bolstered by landmark global agreements such as the Millennium Development Goals (MDGs) and later the Sustainable Development Goals (SDGs), there was both an aspirational consensus on what multilateral global cooperation could achieve, and development was seen as a critical investment for global stability.

Today, we find ourselves confronting a starkly different reality, a nightmare scenario long in the making but one whose arrival nevertheless feels as abrupt as it is unsettling. The optimism of earlier decades has been replaced by caution, doubt, and even open hostility towards global engagement and international cooperation, and the global development industry finds itself in retreat.

A Slow Turning Point

While there is nothing gradual about the United States’ withdrawal from the development industry, the slow-boil transformation beneath it has gone unnoticed by many for years. Rising discontent with globalization initially manifested as pushback against trade agreements and global economic integration, but development agencies became symbolic proxies for the broader “global elite,” seen as disconnected from the very communities they sought to help. William Easterly’s and Dambisa Moyo’s warnings went unheeded, while the development industry did little to justify itself to those who did not instinctively validate its value proposition.

The seeds of discontent were planted in the growing income inequalities within developed nations, which many citizens attributed to globalization and unchecked immigration policies. Politicians, often from the right, skillfully capitalized on these sentiments, amplifying fears and shifting blame towards international agencies and foreign aid programs, portraying them as diverting essential resources from domestic priorities (while the public consistently overestimated how much was being spent to aid foreign nations and how little was gained). The stage was set for the expanding circles of empathy to rapidly contract, an inward turn which has gleefully dismantled decades of consensus around global solidarity. Countries once seen as standard-bearers of international cooperation began to question their roles as global benefactors, ushering in policies focused on national sovereignty and self-interest.

The pendulum has swung most dramatically in the United States, where after decades of an increasingly uneasy relationship with multilateralism, the United States has embarked on a course that now threatens global development as a concept. Much of what we are seeing now was heralded by Donald Trump’s first term. But the withdrawal from the Paris Agreement was only the beginning: Now, the US international development apparatus itself faces dismantling, while the administration disavows the SDGs as neither aspirational nor appropriate. Multilateral commitments hang precariously in the balance, threatening the stability of international institutions relied upon globally.

This shift represents more than mere defunding. It is a decoupling of values, a fundamental debasing of the very concept of international development. The administration has portrayed development work as antithetical to national interests and foreign assistance budgets as wasteful luxuries. In targeting what many conservative politicians deride as "wokeness," this ideological cleansing disregard the complex blend of soft and hard power benefits that development work has conferred to the country. By disregarding the national security threats posed by unchecked natural disasters, pandemics, famines, and water shortages, this radical departure from previous US foreign policy is creating profound uncertainties about future global cooperation and stability.

The immediate consequences of the United States’ retreat from global development are stark. Key projects funded by USAID and contributions to critical UN agencies like UNFPA have halted, leaving significant gaps in humanitarian and developmental support. Tens of thousands of development professionals face uncertain futures, and tens of millions of beneficiaries have lost essential lifelines. Future generations may find it difficult to understand why we didn’t do more to stop the crisis.

The withdrawal of American leadership has emboldened others to roll back their own aid, creating a cascade effect further undermining the global development infrastructure. According to the European Network on Debt and Development, 2024 saw the first drop in ODA since 2017 with total aid budgets falling by 7.1 percent. Countries like France, Germany, Sweden and Finland are undertaking significant cuts to their foreign aid budgets, and parties on the right in many other countries have newfound vigor for calls for an inward turn of their own. These moves amount to an echo effect: once Washington stepped back, the political cost of cutting aid elsewhere fell, accelerating what one analyst called a “burden-shedding cascade” across the entire donor club.

Taking Accountability

There is no uncertainty about the immediate catalyst for all of this. Yet alongside justified outrage at the dismantling of a system we had come to take for granted, the global development industry must confront the role it has played in its own unraveling. For decades, aid agencies have struggled to effectively communicate and quantify their impact. Last year OECD-DAC members rightfully listed inadequate data, difficulties in designing results frameworks, and impact evaluation as the three most urgent reasons they could not accomplish more to reduce poverty. The very same problems have undermined the entire industry’s legitimacy in the eyes of others. Past successes became future assumptions while accountability was too often sacrificed on the altar of good intentions.

Standing on the right side of history and with a moral high ground, the sector grew complacent, failing to recognize that global solidarity requires continuous justification, especially in politically volatile contexts. The development industry’s tendency to focus more on signals of value than actionable transparency on the value they bring has made it vulnerable to criticisms: whether valid or opportunistic, proving just as lethal. Internally, too, persistent criticism for inefficiency, opacity, and excessive bureaucracy—as well as high overheads, unclear impact metrics, and an inability to clearly communicate tangible outcomes to donors and the public—have fostered skepticism and eroded trust among those whose support is now desperately needed.

If the development industry's shortcomings were hidden from sight, for decades, they are laid bare today. The price for the failure is now evident, as is the need for introspection and meaningful reform. In this sense, the path forward, however painful, presents a moment for transformative reflection: Organizations must embrace rigorous accountability and effectiveness standards. Efficiency is imperative, and every dollar must justify itself through clear, measurable impacts.

Navigating a Way Forward

We aren’t looking for silver linings amidst a raging thunderstorm. But whatever good comes from this process will be through adjustments made to ensure survival, innovations of necessity, and acts of desperation during our industry’s great extinction event (from which only the fittest, luckiest, and best connected will see themselves through). Good results will come at a cost no one wanted to pay. And yet we already see the forces of adaptation re-shaping the industry. NGOs, multilateral organizations, and development experts themselves are finding more than shelter from the storm: Many are finding entirely new strategies to thrive to whatever extent there is thriving left to be had.

  • Efficiency and technology: Perhaps the most immediate impact of the great retreat has been a surge of interest in efficiency, process optimization, and technology-driven solutions. The rate of AI adoption in our industry has greatly increased, and organizations around the world are embracing new technologies to extend their reach and reduce operational costs, making programs more efficient and scalable. For example, Mercy Corps has strengthened its commitment to AI and climate analytics, while Accountability Lab, Development Gateway, and Digital Public have launched a partnership matching service to support others through the storm.
  • Localization: Another tangible pivot is a resurgence of localized approaches. As global pillars of support fall one by one, many are finding ways to lean on locally centered designs that shift power and resources closer to beneficiary communities. Funding will be tighter and scopes will be narrower, of course, but closer connections with the local community will pay dividends of its own, opening new paths to genuine sustainability, strengthening local governance, and reducing future dependency on external funding. Many are also doubling down on community empowerment, promoting self-reliance by investing directly in local capacities and institutions rather than the middleware of development, giving the grassroots a more direct role in the process. Some experts go so far as to argue that it is good that African countries are finally encouraged to stand on their own two feet instead of depending on Western interventions.
  • New alternatives, new partners: Many organizations are finding themselves entering into conversations with partners they might not have considered before. Private sector collaborations are on the rise, with organizations seeking to deepen their partnerships with private companies in hopes of leveraging their operational expertise, financial acumen, and innovation capabilities, as well as financial resources. Of course, beneficiary states will recall the specter of historic exploitation, and the possibility of neo-imperialism latent in these emerging corporate relationships. Apart from corporate giving and partnering, interest in individual philanthropies is growing rapidly, leading to both potential solutions to financing gaps as well as power imbalances that may prove too tricky for some organizations to navigate through unscathed.
  • Rethinking the long term: In addition to the tactical shifts, we’re seeing a renewed discourse on the deeper set of strategies deployed by the industry. Impact transparency is among the leading points of discussion, and the need to invest in clearer metrics and more robust reporting practices that communicate tangible outcomes effectively is clear for all who wish to rebuild trust among donors and skeptical publics. The more introspective among us are already calling out for a culture of accountability and a recalibration of how the industry approaches advocacy. Some are even calling for a “back to basics” approach where disease reduction, WASH, literary, and health care concerns are returned to a position of primacy.

A Moment of Truth and Opportunity

The era of assumed inevitability of development work is over. While the discourse is rapidly evolving, it is crystal clear that we will need to return to crafting bipartisan narratives that articulate global development as a shared mission that can appeal to a broader political base.

The harsh lessons of polarization and retreat compel us to acknowledge development work not as guaranteed but as privileged, vital work demanding constant justification, representation, and adaptation. This painful but necessary metamorphosis may yet yield a more resilient and impactful global development ecosystem. If the industry successfully navigates these political headwinds, embedding itself deeper in societal and political foundations, it may emerge stronger, wiser, and more sustainable. In adversity lies opportunity, and perhaps through this crucible, global development will find new legitimacy, broader support, and ultimately, greater effectiveness.

Next in the series:

Read more stories by Michael J. Mortimer & T. Alexander Puutio.