Trump’s Foreign Aid Cuts Are Fueling a Crisis for Displaced People in the Americas
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A federal appeals court ruled on August 13th that the Trump Administration could withhold spending foreign aid funds already appropriated by Congress–adding another massive blow to our dying aid industry and a critical victory for Trump’s alleged plan to “Make Foreign Aid Great Again.” The decision to cut foreign aid–especially aid already appropriated by Congress–has little effect on the American taxpayer (foreign assistance makes up less than 1% of the federal budget), but are threatening protection systems for asylum seekers, refugees, and migrants across the Americas.
The U.S. is abandoning a crisis response in our own hemisphere and undoing nearly a decade of progress managing the displacement of millions of Venezuelans and Central Americans in a manner of months.
The UN Refugee Agency (UNHCR) assists Latin American governments with refugee status determinations, funds shelters, promotes refugee integration, and supports local NGOs. But six months into the Trump presidency, most of UNHCR’s funding, which came from the United States, is suddenly gone.
U.S. funding cuts are felt acutely in the Americas. Regionally, UNHCR decreased national staff by 51%, international staff by 45%, and cut several important programs related to humanitarian support and integration. UNHCR has closed its offices in Guyana and will do the same in Trinidad & Tobago. In Guyana, where nearly half of the population lives in poverty, the shutdown may leave thousands of asylum seekers unable to access refugee status determinations in the country and make it even harder for Venezuelans to integrate locally.
Refugees International has seen firsthand what happens when people lose access to status and services: they live in the shadows unable to fully integrate into their host countries or they migrate again, possibly to the United States.
Costa Rica has the most robust asylum system in Central America, hosting nearly 250,00 refugees and asylum seekers, mostly from Nicaragua. Yet, in 2025, UNHCR’s programming in Costa Rica was cut by a whopping 41 percent and there has been an alarming 77 percent reduction in the capacity to register newly arrived asylum seekers in the country. Refugees International witnessed a once robust humanitarian response now operating at a fraction of its capacity. There is a months-long wait for an appointment to apply for asylum, leaving asylum seekers unable to work or provide for their families.
Although migration to the U.S.-Mexico border has been greatly reduced in 2025, asylum claims at Mexico’s refugee agency (COMAR) are at similar rates to 2024, averaging roughly 250 claims per day. (Some are turning to Mexico since they can no longer enter the U.S.) Despite the great need, UNHCR closed four offices in Mexico and reduced its support for COMAR and shelter networks after its budget was cut by 60%. This could have life threatening consequences: Refugees International has interviewed dozens of people in Mexico who faced violence and extreme vulnerability due to their lack of a regular status.
Colombia is home to the largest number of displaced people in the region – nearly 3 million Venezuelans and more than 7 million internally displaced people. Up until 2023, Venezuelans in Colombia could access a temporary protected status that lasted 10 years. This status is no longer available to nearly 500,000 irregular Venezuelans in Colombia, many of whom are turning to the asylum system to obtain legal status and completely overwhelming the country’s system.
Cuts to UNHCR and elimination of protected statuses across the Americas means millions of displaced people will not have access to critical services like healthcare and education or permission to work in formal labor markets. Refugees International has seen firsthand what happens when people lose access to status and services: they live in the shadows unable to fully integrate into their host countries or they migrate again, possibly to the United States.
To prevent this from happening, donor countries need to fill the funding gap left by the loss of U.S. leadership and support. This can be done, as it was in the past, through solidarity conferences or through fulfilling commitments made through the Global Compact on Refugees.
Additionally, regional governments also need to consider allocating more funding to their own protection systems for migrants and applying the Cartagena Declaration standard – a broader refugee definition than in the 1951 UN Convention – when processing claims in order to improve efficiency. When governments have adopted this approach, refugees and economies thrive. Brazil’s Operação Acolhida initiative has used simplified status determination procedures and relocation across the country to rapidly protect and successfully integrate 150,000 Venezuelans.
Finally, people across Latin America who advocate for migrants and refugees should continue to raise their voices about the importance of foreign assistance in maintaining the progress made over the last decade. This includes nurturing a strong sense of solidarity with forcibly displaced people, combatting xenophobia, and ensuring that Latin American countries preserve their long tradition of providing asylum and international protection to those in need.
By abandoning investment in the region’s asylum systems, the U.S. is not only creating undue suffering for people experiencing displacement but we are also deepening crises that we could later struggle to address on our own doorstep.
Rachel Schmidtke is the Senior Advocate for Latin America at Refugees International.
Laureano Rodriguez Di Santo is a lawyer from the University of Buenos Aires Argentina and a Rotary Peace Fellow, currently pursuing an MA at the University of Bradford (UK). He previously worked with UNHCR on refugee protection in Argentina and Costa Rica.