U.S. funding cuts: Nearly $1 billion in funding dries up for entrepreneurs in 6 African countries

This abrupt financial shortfall caused by U.S. President, Donald Trump’s aid cuts threaten to stall innovation, disrupt startup ecosystems, and undermine years of progress driven by African entrepreneurs.

The affected businesses, once beneficiaries of robust development initiatives and enterprise-focused aid, are now confronting the harsh realities of shifting U.S. priorities under Trump’s administration.

Following his inauguration, President Donald Trump established the Department of Government Efficiency (DOGE) to oversee federal spending and identify wasteful or redundant agencies for shutdown.

DOGE, led by billionaire businessman, Elon Musk was tasked with streamlining government operations and curating which departments to scale back or eliminate entirely.

Among the hardest hit by the restructuring was USAID, the lead U.S. agency funding SMEs and entrepreneurs in Africa through grants and technical assistance.

USAID experienced the most significant budget cuts, with projects worth billions of dollars paused.

Many other development organizations operating globally were also forced to halt their operations due to widespread aid reductions.

In a post-restructuring report on X, DOGE revealed that the U.S. government aimed to save around $295 billion through these aid and efficiency measures.

The department confirmed the termination of 7,279 contracts, resulting in $25 billion in savings; 9,283 grants were canceled, yielding $33 billion; and 676 federal leases were ended, saving $400 million.

In addition, DOGE halted 108 contracts labeled as wasteful, with a ceiling value of $205 million, securing $70 million in direct savings.

In total, the reforms are estimated to have saved the U.S. government $150 billion, equating to approximately $931.68 per American taxpayer.

Speaking via their official X (formerly Twitter) page, DOGE revealed that several projects across Africa were forced to pause operations following recent funding cuts.

These initiatives, which ranged from wellness and spa enterprises to technology-based startups, lost critical support amounting to millions of U.S. dollars.

DOGE confirmed that the affected programs include:

Following significant cuts in U.S. government funding, several entrepreneurial projects in Africa were forced to pause, affecting SMEs across the continent.

In Burkina Faso, a grant of $229,296 for marketing 100% organic shea butter was canceled, while Benin lost $239,738 allocated for promoting pineapple juice.

Ivory Coast saw the cancellation of $246,217 for mango drying facilities, and Uganda lost $99,566 intended to expand yogurt production.

Kenya had $48,406 for a WhatsApp marketing chatbot scrapped, and Nigeria lost $84,059 meant for a spa and wellness incubator.

These cuts represent a significant blow to African entrepreneurs who rely on external support to grow their businesses and drive economic development.

With millions in funding lost, these projects now face uncertain futures.