Liberia: U.S. Govt Cancels U.S.$17m Support to Liberia

The government of the United States, through its Department of Government Efficiency (DOGE), has announced the cancellation of a $17 million United States Agency for International Development (USAID) project aimed at offering tax policy advice to Liberia.

Elon Musk, head of DOGE, announced the cancellation of the support on Monday, February 10. He used the social media platform X to express his concerns about the allocation, asking, “Why would anyone believe that this is a wise use of YOUR tax money?”

The $17 million project, known as the Local Empowerment for Accountability and Decentralization (LEAD), was meant to complement USAID’s Local Empowerment for Government Inclusion and Transparency (LEGIT) and Revenue Generation for Governance and Growth (RG3) projects led by Development Alternatives, Inc. (DAI).

This initiative was designed to support decentralization, local governance, and domestic resource mobilization efforts in Liberia.

The LEAD project sought to enhance the capabilities of selected government ministries, agencies, and commissions in formulating and implementing effective tax policies, enhancing budget transparency, advancing decentralization, and enhancing service delivery at the sub-national level

However, the latest move by the US government has shocked many Liberians and others as the US has been a key strategic partner to Liberia, especially since the end of the civil war-donating nearly $2 billion in assistance.

The decision of the US government, through Musk, to cancel the project aligns with its broader strategy of reviewing and cutting down on federal spending that it deems unnecessary or not in line with the interests of American taxpayers.

This action is part of a larger effort by DOGE to evaluate federal expenditures. Recently, Musk disclosed that he had accessed the U.S. Treasury’s payment system and vowed to terminate several government grants due to concerns about automatic approvals benefiting potentially fraudulent or terrorist-affiliated groups.

Many believe this cut is a huge blow to the Liberian government.

Following the end of Liberia’s civil conflicts, the United States has contributed approximately $2 billion in aid, coordinated by the State Department and USAID, to support stabilization, security sector reform, governance, and investments in key sectors, notably health and education.

Liberia is also a beneficiary of the US government’s Malaria and Feed the Future initiatives. USAID assistance for Liberia amounted to $112.3 million in FY2018 and $96.5 million in FY2019, although the current website is temporarily inaccessible. Recent U.S. aid has primarily targeted health system enhancement, support for public service delivery, capacity building for civil society, development of the agriculture sector, and improvements in the justice sector.

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Musk, a staunch supporter of controversial US President, Donald Trump, suggests shutting down USAID and handing over responsibilities to DOGE in order to trim inefficiencies in the U.S. government.

Many critics of the Trump administration and the DOGE program raise concerns that abrupt cancellations could negatively impact international relations and development initiatives. They emphasize the need to balance fiscal prudence with the potential long-term advantages of foreign aid projects, which play a role in promoting global economic stability and nurturing diplomatic relationships.

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