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US Funding Cuts: Philanthropy must step in to support locally-led development


The US Government’s abrupt 90-day foreign aid pause and uncertainty about the US Agency for International Development’s (USAID) future are hurting Global South civil society hard. The US developments come on the back of previous funding cuts announcements from
Germany, Netherlands and Sweden. Those disruptions will worsen the funding situation and power imbalances between the Global North and South.  

The disruptions are putting communities at risk, shifting power away from local civil society actors, and eroding trust in international cooperation. They are forcing civil society organisations into reactive survival mode.

In response, we call on philanthropy, that is foundations and individual givers, to step-up and support locally-led development (LLD), channelling more resources for local actors and ensuring they have a seat at the table. This requires a targeted effort to ensure local actors’ financial, legal, and security resilience. 

CIVICUS and its partners call on philanthropy to leverage all available resources to address the present emergency. They must act as investors, funders, catalysers, amplifiers, mobilisers, and collaborators to support civil society in their time of need. We recommend the following actions:

  1. Commit to immediate, flexible, and sustained financial support

Philanthropy should prioritise high quality, flexible, core and predictable funding mechanisms to enable local actors' autonomy and agency, instead of funder priorities. This includes establishing immediate, flexible, and emergency grants to help local actors navigate funding gaps. Increasing flexibility in existing grants will allow for operational reallocation to cover urgent needs. Offering unrestricted funds is critical for promoting security, including financial, legal, and digital protection. 

  1. Strengthen local actors’ governance through collaboration and promote trust and support 

It is critical to support local actors to strengthen their governance, risk management, and compliance systems. This is best achieved through fostering collaboration and innovation rather than imposing external standards. Support should be tailored, contextually appropriate, and co-designed. 

Direct support must be provided to local actors to develop systems that prioritise accountability, while trusting local actors to manage resources (e.g. direct payment to accountants and lawyers).

Compelling narratives and ambitious policies are needed to stimulate trust and support to local civil society from a range of state and non-state actors and the public. Progressive philanthropies can encourage other funders to follow suit. 

  1. Invest in infrastructure enabling diverse local civil society groups to collectively organise, share resources, and strengthen resilience  

Philanthropy investments in infrastructure can enable civil society to bravely defend and promote civic freedoms. Such investment will facilitate collective influencing and knowledge-sharing networks, ensuring the organisations are better prepared for further funding instability. 

Philanthropy can earmark funds for emergency response for legal defence, audits, and unforeseen security threats. Security in the digital sphere is also a critical need, and support can be provided on digital communications infrastructure, encrypted platforms, and security audits.

In the current context, philanthropy should support protection of civic space and promotion of civil society participation in decision-making. This will help enable strategic resistance against attempts to roll back hard-won human rights, gender, racial and social justice gains. 

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