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US funding freeze hits Lankan NGOs supported by USAID
View(s):By Mimi Alphonsus
USAID is the largest single donor in Sri Lanka and funds hundreds of local NGOs, as well as government programmes. According to estimates by officials at the NGO secretariat, about half of all funding to NGOs and CSOs comes from USAID amounting to around Rs 15 billion last year.
Crucial fields have been hit hard. Women In Need (WIN), an NGO supporting survivors of domestic violence and other violence against women through counselling, emergency shelters, and legal assistance is facing a huge challenge. Around 85% of their operations are currently funded by USAID. Their Crisis Centre in Ratnapura was funded entirely with USAID’s support and is operated by 7 staff including lawyers and counsellors. Last year the centre served 950 women.
USAID is the largest single donor in Sri Lanka and funds hundreds of local NGOs, as well as government programmes. (Pic courtesy USAID)
“We may have to shut down the centre entirely,” said Mariam Mohamed, attorney-at-law and WIN’s Programme and Legal Manager, “even if our project is subsequently approved post-review, USAID does not guarantee that we will be reimbursed for that period. A non-profit such as WIN is not equipped to bear this cost.”
Ms Mohamed and WIN’s Executive Director Savithri Wijesekera are currently in discussions with the Ministry of Justice and Ministry of Women and Children’s Affairs. “The Ministry of Women partly supports WIN’s 4 emergency shelters [alongside USAID and other donors]. There is no way we can shut them down as they provide safety to thousands of women and children subject to unimaginable abuse,” Ms Mohamed said. All 4 shelters are currently full.
WIN has expanded significantly in the last few years, thanks to USAID funding which handed them a 5-year contract. But the risks of a dependency on a single large donor is beginning to show. Ms Mohamed explained that because of the scale of the USAID project, they have not been pursuing other major avenues of funding, though they do receive some funds from other countries.
“We are disappointed that there has been no warning, and no time to prepare for an order such as this, which directed partners to stop all USAID activities overnight,” explained Ms Mohamed, “We have had to make very tough decisions to downsize.” Mohamed is hopeful that WIN will receive the green light after the 3-month review since they are anyway nearing the end of their project.
Globally, life-saving humanitarian aid has been granted an exemption, allowed to proceed with their activities, but USAID did not confirm whether any Lankan partners have qualified for it. In response to the Sunday Times query, a USAID spokesperson shared of the global situation, “We are expeditiously processing exception requests. Several urgent requests have been approved within hours.”
The US embassy did not respond for comment.
Besides NGOs and CSOs working on issues ranging from gender rights, election monitoring, nutrition, climate change adaptation, anti-corruption, and disaster relief, USAID also provides funding to government programmes. Officials at Parliament, who requested anonymity, shared that USAID has been instrumental in providing experts to sectoral oversight committees and crucially the Committee On Public Finance (COPF) and Women’s Parliamentary Caucus. USAID and Sri Lanka Parliament were undertaking discussions on proceeding with their partnership when the executive order was implemented.
MP Harsha de Silva who heads COPF shared that they have always relied on USAID to provide crucial technical assistance. “COPF has no technical staff at all,” explained de Silva, “we were anticipating that USAID would provide analysts as they have done in the past, but really it is the Government’s role to make sure we have high quality analysts.” Besides their weekly studies, COPF has two major reports due by mid February on expenditure allocations and on forecasts for debt, expenditure and revenue.
Besides parliament, other entities too will be hard hit. Officials confirmed extensive USAID support in strengthening independent institutions such as the Committee to Investigate Allegations of Bribery and Corruption and the Bar Association of Sri Lanka. The Board of Investment too was in discussions to receive technical support and training.
USAID also works with the private sector, partnering with banks such as HNB and DFCC to improve access to credit for small and medium enterprises. They also helped boost trade by minimising bottlenecks working with entities like the Chamber of Commerce.
Thousands of people work in Sri Lanka’s NGO sector, many of them sustained by USAID. Well placed industry sources shared that easily over 1,000 people’s jobs are at risk. Bhoomi Harendran, the founder and head of Transgender Network Sri Lanka who receive about 40-50% of their funding from USAID, said that they have already been forced to lay off staff. Transgender Network Sri Lanka helps transgender people receive shelter, food and psychological support. Given Trump’s policy plans, she does not expect theirs to be among the organisations that withstands the review.
According to an official (who requested anonymity) at Asia Foundation, an international development organisation that receives USAID funding and partners with local NGOs, those working in small, grassroots groups are likely to be most affected. “National NGOs have multiple projects and might be able to absorb some of the salary costs into these projects from other donors,” the source shared, “but smaller ones without those facilities will suffer.” The Sunday Times learnt of some organisations that had not yet paid January salaries to their staff before the stop order, and others who had paid for programming expenses, expecting to be reimbursed by USAID.
NGOs sit with a sinking feeling of betrayal. “We had contracts with the state department and with USAID. All of that was scrapped with no warning, arbitrarily without any sense of natural justice,” said the head of an organisation that receives 50% of its funding from USAID, “We fear that we will be punished for speaking up, costing us future funding. The reputational damage to the US is going to be huge.”
The halt of USAID funding leaves a massive gap in not only Sri Lanka’s aid sector, but around the world. International media reported that hospitals were turning away refugees and soup kitchens in conflict zones were shutting down. They warn that USAID is likely to be enfeebled under Trump’s administration. Besides the funding freezes, they point to the firing of senior USAID staff, intrusive reorganising and Trump’s failure to appoint an administrator, as the early signs of a smaller, weaker USAID. NGOs, civil society, and the Government will have to brace for the changes.
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