The Trump administration’s push to restructure the United States Agency for International Development (USAID) is sending ripples through Egypt’s higher education sector, disrupting scholarship programs and potentially cutting billions in critical funding. As the U.S. shifts its foreign aid priorities, students, universities, and the broader economy face mounting uncertainty.
A legacy for strategic investments
For decades, USAID has played a vital role in supporting Egypt’s development, investing more than $30 billion in economic assistance since 1978, according to the U.S. Embassy in Egypt. A significant portion of this aid has been allocated to education, infrastructure, economic development, and healthcare—sectors that directly impact Egypt’s long-term growth and workforce readiness.
In June 2024, Egypt secured $130 million in USAID grants across multiple sectors, with approximately $47 million dedicated to education initiatives. This included $35 million for the Egyptian-American Higher Education Initiative, $12 million for the second phase of basic education, and $13.5 million for economic governance—underscoring the agency’s deep commitment to Egypt’s youth and academic development.
Through scholarships, exchange programs, and university partnerships, USAID has enabled thousands of Egyptian students to pursue advanced studies, both at home and abroad. These programs have not only bolstered individual academic and professional careers but have also contributed to Egypt’s knowledge-based economy by fostering innovation, research, and international collaboration.
According to the US official foreign aid website, Egypt received $237.86 million worth of USAID in 2023, distributed across higher education, primary education, and agricultural development.
Last week, US President Donald Trump ordered a 90-day freeze on foreign aid, with initial exceptions only including food assistance as well as military aid to Egypt and Israel. With the sudden suspension of USAID funding, Egyptian universities and students are left grappling with uncertainty. Over 1,000 undergraduate students on USAID-funded scholarships—spread across public, private, and national universities as well as the American University in Cairo (AUC)—are now at risk of losing financial support.
“This freeze has severely impacted my academic life, leaving me without a clear plan or direction,” said Essam El-Din Aboelatta, a USAID scholar who was set to begin his studies at AUC. “The timing was especially devastating, as it came just three days before I was supposed to start classes.”
The situation is particularly dire for newly accepted students and those enrolled in preparatory English-language programs, many of whom may have to defer or abandon their academic plans altogether. The uncertainty surrounding USAID’s restructuring has also left universities scrambling to fill the funding gap, with institutions like AUC turning to budget savings and fundraising to support current students for at least the spring semester. However, such stopgap measures are unsustainable in the long run.
Broader economic impact
The suspension of USAID funding is not just an academic setback—it has broader implications for Egypt’s economy. The country’s higher education sector is a critical pipeline for producing skilled professionals in fields like engineering, business, and technology. Interruptions in funding threaten to weaken this talent pipeline, impacting workforce development and Egypt’s competitiveness in the global market.
Additionally, reduced foreign aid could slow ongoing research and innovation initiatives, which have historically benefited from U.S.-Egypt partnerships. Collaborative projects in clean energy, agriculture, and digital transformation—areas crucial for Egypt’s economic diversification—may struggle to move forward without USAID backing.
As the Trump administration moves to place USAID under the control of the State Department, stakeholders in Egypt’s education sector remain in limbo. Whether funding will be restored or redirected remains uncertain. In the meantime, universities and policymakers are exploring alternative funding sources, including increased government support, private-sector partnerships, and international collaborations.
The Egyptian Ministry of Higher Education and Scientific Research held an emergency meeting following the U.S. executive order to assess the academic status of 1,077 undergraduate students on USAID scholarships. These students are enrolled across Egyptian public, private, and national universities (877 students) and AUC (200 students). In an official statement, the ministry confirmed that universities would cover all tuition fees and educational expenses previously funded by USAID through the end of the second semester.
AUC also announced that it would bear the costs for the 200 Egyptian students currently enrolled in the scholarship program during the second semester, coordinating closely with the ministry. “We will offset the cost for the spring semester through budget savings and fundraising because of our deep commitment to the education and well-being of our students,” said Professor Ahmed Dallal, President of the American University in Cairo.
However, the university stated it would be unable to assist approximately 125 newly accepted students who were set to begin their studies this semester, as well as those in the English-language bridge program. “We understand the painful situation these students now face and wish we could accommodate them. We simply do not have the financial resources,” Dallal explained.
For students, the uncertainty is particularly unsettling. “I must spend the next eight months at home without university; otherwise, my GPA will suffer,” said Habeeba Ayman, a scholarship recipient struggling to enroll in a public university mid-year. “My education journey is on hold.”
If USAID’s role in Egypt is significantly diminished, the country’s ability to provide quality, accessible higher education will be challenged, with long-term repercussions for its economic and human capital development. The next few months will be critical in determining the future of U.S.-Egypt education partnerships—and the thousands of students whose academic futures hang in the balance.
De-facto takeover
On February 5, Secretary of State Marco Rubio confirmed his role as acting administrator of USAID, solidifying the State Department’s de facto takeover of the humanitarian agency.
“The Department of State and other relevant entities will consult with Congress and appropriate committees to reorganize and absorb certain USAID bureaus, offices, and missions,” Rubio wrote in a letter obtained by CNN. “USAID may move, reorganize, and integrate certain functions into the State Department, with the remainder of the agency potentially being dissolved in accordance with applicable law.”
The decision to suspend U.S. foreign aid funding for 90 days follows claims from Trump and congressional Republicans that “much of foreign aid and development programs are wasteful,” CNN reported. When asked about USAID’s status on February 2, Trump told reporters, “Well, it’s been run by a bunch of radical lunatics, and we’re getting them out… and then we’ll make a decision.”
Despite allocating less than 1% of its budget to foreign assistance, the U.S. remains the world’s largest humanitarian aid donor by a significant margin. According to The Guardian, USAID’s current global humanitarian operations budget stands at $42.8 billion.