Spurce: Lara Jameson/ Pexels
“Iraq’s civil society is on the brink of collapse. With the abrupt freeze of U.S. foreign aid, organizations that have long delivered essential humanitarian and economic services now face an existential crisis,” reported the Iraqi media outlet Shafaq News on April 2, 2025. The outlet further warned that “nearly 90% of civil society organizations could shut down within two years.”
Iraq has been one of the primary recipients of funding from the United States Agency for International Development (USAID), particularly following the 2003 U.S.-led military intervention. According to data from USAID and the U.S. Department of State, Iraq was the third-largest recipient of U.S. foreign aid between 2001 and 2023, receiving a total of approximately $89.4 billion. Although Iraq no longer ranked among the top ten U.S. aid recipients in 2023, it still received an estimated $600 million in foreign assistance that year.
USAID’s support to Iraq has been distributed across multiple sectors, including humanitarian assistance to vulnerable populations and internally displaced persons (IDPs), rehabilitation programs facilitating the return of displaced communities—particularly after the war with what was known at the time as the “Islamic State of Iraq and Syria” (ISIS) in the northern and western regions—support for small businesses and entrepreneurship initiatives, educational programs, the reconstruction of essential public services and infrastructure, and efforts to strengthen governance and administrative capacities within both governmental and non-governmental institutions.
While a portion of USAID funding is channeled to the central and local governments, a smaller share is allocated directly to local non-governmental organizations (NGOs) to implement humanitarian and development projects. In fact, the majority of civil society organizations in Iraq have relied on subgrants or subcontracts from major USAID prime implementers such as World Vision USA, Save the Children US, Chemonics International, and Development Alternatives Inc. (DAI). As these prime implementers begin to scale back or terminate their projects in response to the USAID funding freeze, many local NGOs are facing a serious reduction in financial support, threatening their operations and long-term sustainability.
Following the announcement in February 2025 of a freeze on new funding commitments pending further review by the U.S. government, concerns have emerged regarding the future of key projects, particularly those related to the transfer and reintegration of refugees and internally displaced persons (IDPs).
“One of the major projects previously supported by USAID is the repatriation of Iraqi nationals affiliated with or linked to the Islamic State, currently residing in al-Hol Camp in northeast Syria,” said an employee of a Dutch peace-building NGO, who requested anonymity during a phone interview. “An estimated 30,000 Iraqi nationals remain in the camp, making them the largest national group there. Since 2021, many have been gradually repatriated, primarily to Mosul and to the nearby al-Jadaa camp. Now, the future of this project is uncertain, which could have serious negative repercussions—not only for those still stranded in Syria, but also for communities in Mosul receiving the returnees.”
In addition to its direct impact, the USAID funding freeze comes at a time when international aid for Iraq has already been in steady decline for several years. According to the UN Office for the Coordination of Humanitarian Affairs (OCHA) Financial Tracking Service (FTS), total reported humanitarian funding for Iraq has decreased by approximately 77% between 2020 and 2024, raising concerns about the sustainability and survivability of many organizations and initiatives operating in crisis-affected areas.
While concerns are being raised about the sustainability of civil society organizations in Iraq in light of shrinking funding, there is also growing criticism of their long-standing shortcomings and mismanagement. “For their part, Iraqi civil society organizations also bear some of the blame,” Abdulsalam Medeni stated for the Washington Institute in November 2024. “Most have failed to take bold action to become a significant force in bringing about change and influencing decision-making.”
Many observers argue that Iraq’s post-2003 civil society has struggled to establish itself as a strong and independent force capable of challenging sectarianism, ethnic divisions, political fragmentation, corruption, and ongoing instability – despite the diverse and abundant funding many organizations have received since 2003. Many civil society organizations are affiliated with political parties and are therefore entangled in the same corrupt and sectarian dynamics that dominate Iraq’s political landscape.
However, in recent years, a new grassroots civil society movement has begun to emerge. This movement, more independent and citizen-driven, has become increasingly vocal—most notably during the widespread protests that began in October 2019 across central and southern Iraq. It is these initiatives and organizations whose survival is threatened by the termination of US foreign funding, as Moustafa Nasser, an Iraqi journalist describes:
“At this moment, there is no viable alternative. Around 90% of Iraqi civil society organizations are funded by U.S.-based donors who previously received USAID support and are now forced to suspend their grant programs. Neither international nor European donor organizations appear willing to fill this gap, and they offer only limited support to civil society organizations and initiatives.
This vacuum ultimately benefits radical political actors and militias in Iraq who perceive civil society as a threat to their influence. It risks enabling Islamic militias to gain complete control over Iraqi society and public life. The progress made over the past two decades is now at risk, despite the fact that civil society has, in recent years, increasingly challenged traditional political and religious forces and established itself as a meaningful actor.
We can already sense the tide turning. The Ministry of Interior is currently revoking the licenses of many organizations. The organization I work with is on the verge of closing its office in Baghdad due to the halt in U.S. funding. We plan to continue working on a voluntary basis, but this might lead to the revocation of our license. The Department of Non-Governmental Organizations considers the lack of a physical office grounds for license cancellation.”
Many Iraqis active in civil society are hoping for increased support from European or other international donors, while others emphasize the need to adopt more self-sustaining strategies or philanthropic approaches to aid and development. However, no tangible solutions or alternatives have emerged so far, leaving many in a state of uncertainty and concern.
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