Picture a familiar Tuesday. A CSO director sits down to rewrite the same proposal for the fourth call this year — new logo, new deadline, the same paragraphs recycled from three rejections before it. None of those three came with feedback. Just a two-line email: “Thank you for your interest. Unfortunately, on this occasion...” She is not failing at her job. She built an organisation that used to get funded without this much friction. Something changed. She was just never told what.
In fifteen years working with civil society organisations across North Africa, the Middle East and the Sahel — as a grants manager, a programme lead, and later an adviser on organisational capacity — I have sat on both sides of that email. What follows is what the data actually shows about what changed, and what to do about it.
I. What changed, stated in full
Start with the headline number, because it is worth stating precisely rather than rounding it into something vaguer. Official development assistance — the aid that flows from OECD donor governments into development and humanitarian work worldwide — fell by 23.1% in 2025, from USD 215.1 billion to USD 174.3 billion. That is the steepest single-year drop ever recorded by the OECD, and it followed an 8.5% decline the year before, meaning the sector has now contracted for three consecutive years.1
The decline is not evenly spread. Five donor countries account for 96% of the entire drop: the United States (down 57%), Germany (down 17%), France (down 11%), the United Kingdom (down 11%) and Japan (down 6%). The United States alone — long the largest single donor — supplied more than half of the total global decline on its own.2 And the OECD’s own June 2026 projections show this is not a one-year correction: a further 6.9% fall is expected in 2026, which would put global aid at its lowest level since 2014.3
The poorest countries are absorbing this disproportionately. Bilateral aid to least developed countries fell 25.8% in 2025 and is projected to fall a further 10.9% in 2026. Sub-Saharan Africa saw a 26.3% drop in 2025, with another 11.6% decline projected for this year. Financing for global health — vaccines, disease programmes, health system support — is projected to fall as much as 63% below its 2022 peak.4
II. Why this felt so sudden: the US shock, specifically
Most funding contractions happen gradually — a budget line trimmed here, a renewal delayed there. What made 2025 different is that a large share of it happened at once, in a single policy decision. On 10 March 2025, the US Secretary of State announced that a six-week review had concluded with the cancellation of 83% of all active USAID contracts — roughly 5,200 of them. Documents later submitted to Congress put the final figure at 5,341 terminated programmes against 898 retained, an 86% cancellation rate. The total value of the terminated programmes was USD 75.9 billion, of which USD 48.2 billion was already obligated, contracted money that organisations had built budgets, staffing and programme plans around. On 1 July 2025, USAID was formally closed, with its handful of surviving programmes folded into the State Department.5
This is the detail that a topline percentage can obscure: for organisations that depended heavily on US government funding, the change did not arrive as a gradual decline to plan around. It arrived as a stop.
Other major donors moved more slowly, but in the same direction. UK bilateral aid to the Middle East and North Africa is set to fall 45% in the 2026/27 fiscal year alone — from roughly £680 million to £375 million — part of a wider UK policy shift that will see aid fall to 0.3% of national income by 2027, the steepest cut among G7 donors. By 2028/29, the MENA allocation will be down 56–58% compared with 2024/25 levels.6
III. Why local organisations feel it first
Large international organisations feel this too, but most have reserves, several donors, and headquarters staff dedicated to fundraising. Most local and national CSOs across this region do not have that cushion. They survive project to project. Many depend on one or two donors for the bulk of their budget, and when that funding pauses, there is no reserve to bridge the gap and often no second relationship developed enough to step in quickly. Staff who can find steadier work elsewhere tend to leave first, taking institutional memory with them. And because many internal systems were built to satisfy one donor’s specific template — its own reporting format, its own indicators — rather than to run the organisation itself, the compliance work rarely leaves behind anything reusable for the next funder.
The survey data bears this out directly. A global survey of civil society organisations across 42 countries, conducted by IFES in mid-2025, found that 84% had already lost funding because of the aid cuts, and the same share expect further cuts in 2026. Looking ahead, 36% said they had little or no confidence they could keep delivering programmes at their previous level over the next two to three years. Some new funding has appeared — 87% of respondents reported receiving at least some new financial support during the year — but only 5% said it was mostly offsetting what they had lost.7
The structural picture is similar in the humanitarian system specifically. The Global Humanitarian Assistance Report 2025 found that combined direct and indirect funding to local and national actors — the organisations closest to the people receiving aid — had fallen to just 7.5% of total humanitarian assistance in 2024, far short of the 25% target major donors committed to under the 2016 Grand Bargain. The same report projects that public humanitarian funding overall could contract by 34–45% by the end of 2025 compared with 2023 levels.8
Some parts of the sector are being hit even harder. A UN Women survey of 411 women’s rights and women-led organisations working across 44 crisis-affected countries, published in May 2025, found that 90% reported direct financial impact from the cuts, and close to half expected to close within six months without new funding.9
None of this describes failure. It describes a funding relationship that was never really built for organisational resilience. It was built to satisfy the funder in front of you, one grant at a time — and in markets with a large number of active associations, that vulnerability is compounded by sheer competition for a shrinking pool. Tunisia, for instance, had 25,080 active registered associations as of September 2024, according to IFEDA’s national count — all now drawing on the same contracting pool of donor funding.10
IV. The bar moved
When money is abundant, funders mostly ask one question: is your cause worthy? When money is scarce, they ask a different one: can we trust you with what little we have?
That second question is now being answered by looking at things that used to matter less. Whether governance is real — a board that actually makes decisions, not one that meets to approve minutes already written. Whether financial systems and controls would survive an audit. Whether policies on safeguarding, anti-fraud, conflict of interest and do-no-harm exist not just as signed PDFs but as things staff actually follow. Whether the organisation can show results beyond activity counts — not just how many people were trained, but what changed because of it. Whether there is a distinctive value proposition, something this organisation offers that the next application in the pile does not. And whether the organisation can adapt when circumstances shift, rather than waiting for the old model to return.
At the same time, the money that remains is increasingly being concentrated into fewer, larger, pooled channels rather than spread across many small direct grants — the reverse of the localisation trajectory the sector spent a decade arguing for. That structurally favours organisations that can show, quickly and credibly, that they are ready to absorb larger, more scrutinised funding. Readiness has become the filter before the cause is even considered.
V. Know where you stand
Most organisations sense that something is wrong. Very few can name exactly what. In a funding environment this tight, guessing is expensive — a rejected proposal costs months, and most organisations never find out why it failed.
Here is a faster way to find out. Six questions. Not a test — more of a mirror. Answer them honestly, on your own or with your leadership team.
- If your largest donor stopped tomorrow, how many months could you keep going?
- Could you send a funder your safeguarding, anti-fraud and conflict-of-interest policies today, approved and actually in use?
- Can you say in one sentence what your organisation does that nobody else does as well?
- When did your board last take a decision that changed the organisation’s direction?
- Can you show results beyond “number of people trained”?
- Apart from your current donors, who could fund you next year, and have you spoken to them?
If several of these are uncomfortable to answer, that discomfort is useful information. It tells you, in advance, roughly where your next rejection is likely to come from — before you spend another six weeks on a proposal that was never going to clear the new bar.
VI. Diagnose, then adjust
Once you actually know where you stand, the work stops being overwhelming and becomes finite. Not everything needs fixing at once. Diagnose first. Then pick the two or three gaps that are genuinely blocking funding — not every imperfection, just the ones a funder would notice first — and fix those before anything else.
The organisations treating this moment as a signal to adjust — restructuring, refocusing, formalising what was informal, professionalising what was ad hoc — are already coming out of it stronger and more fundable than they went in. The ones waiting for the old funding model to come back are, on the evidence in this piece, waiting for something that every major forecaster expects to keep contracting rather than reverse.
At Complexia, we have spent the past months turning years of field experience with civil society into a structured way to make exactly this diagnosis. Next week, we are opening it to a first group of partner organisations. Follow Complexia if you would like to be among them.