As bankers and finance ministers try to set the world to rights at the World Bank and International Monetary Fund Spring Meetings, the Millennium Challenge Corporation — a rare bipartisan aid success story — has landed in the Trump administration’s crosshairs.
Also in today’s edition: Um … cockroaches?
Now you MCC it, now you don’t
The Millennium Challenge Corporation — long seen as a bipartisan darling — may be the next U.S. foreign aid agency to fall under President Donald Trump’s ax.
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Staff got a blunt email on Tuesday: “There will soon be a significant reduction in the number of MCC’s programs and relatedly the agency’s staff.” The note cited guidance from the Department of Government Efficiency, or DOGE — the same group behind the shuttering of USAID.
Though no hard numbers were shared, the message rattled MCC's roughly 300 staffers, who’ve been offered early retirement or a deferred resignation deal that lets them stay on paid leave until Sept. 30 — or sooner if they choose.
It’s not a done deal, one employee tells Devex, but staff are not expecting a last-minute reprieve. Staff were informed yesterday that all contracts are being canceled starting today. Some projects will get a few months to wrap up; others — especially those not yet off the ground — will be axed immediately. Senior leadership, said to be caught off guard, reportedly fought to save the agency, but were told MCC simply didn’t align with Trump’s foreign policy.
The agency, created under former President George W. Bush and known for rigorous grant standards and a scorecard-based eligibility system, has disbursed nearly $17 billion to 47 countries over the past two decades. With an annual budget around $900 million, it’s been a quiet workhorse — one that also doubled as a tool to counter China’s influence.
Scoop: Elon Musk’s DOGE takes aim at Millennium Challenge Corporation
Related reading: 20 years of MCC — how big dreams faced tough realities (Pro)
Own goal
If the reports are true, and the Trump administration really is about to shutter MCC, let’s just say the development world is not taking it quietly.
“Pretty much the only bit of the US government funding public sector infrastructure in developing countries,” Charles Kenny of the Center for Global Development reminds everyone, pointing out MCC has been doing the kind of work that China’s Belt and Road initiative does — “only with grants rather than loans.” And it’s bipartisan. Though, as Kenny adds dryly: “The USAID experience so far suggests that might not be worth as much as you would think!”
The ONE Campaign expressed alarm at the possible closure.
“To abruptly eliminate its programming would be self-defeating,” says ONE’s Elizabeth Hoffman. “MCC brings an innovative and entrepreneurial approach to development assistance that holds governments accountable and effectively counters malign foreign influences like China.”
Liz Schrayer of the nonprofit U.S. Global Leadership Coalition pulls no punches: “China, Russia, and our other rivals are jumping with joy.”
Scott in the act
U.S. Treasury Secretary Scott Bessent didn’t mince words at the World Bank-IMF Spring Meetings, calling for a major course correction.
“The IMF and World Bank serve critical roles ... [but] under the status quo, they are falling short,” he said. Still, his speech made clear that the U.S. was “eager” to work with them — potentially quelling some fears the U.S. would withdraw as a member.
For the World Bank, Bessent wants a back-to-basics reboot: no “blank checks” for buzzword-laden promises; more focus on poverty reduction, private investment, and reliable energy — including fossil fuels and nuclear energy. “Energy abundance sparks economic abundance,” he said, applauding the bank’s shift toward supporting nuclear and its Mission 300 initiative.
He also wants the bank to stop lending to countries such as China.
Over at the IMF, Bessent’s message was also clear: He wants them to stick to macroeconomics, Senior Reporter Adva Saldinger tells me. The IMF must be a “brutal truth teller,” he said — no sugar-coating, no detours into climate or gender agendas. And that honesty should apply to all, including countries such as China that have “pursued globally distorted policies.”
Bottom line: “America First means we are doubling down on our engagement,” Bessent said — but only if these institutions deliver real results.
Read: US Treasury Secretary — US will stay engaged with World Bank, IMF
ICYMI: Is this the moment for nuclear energy at the World Bank?
Background: Could the future of the World Bank be outside of Washington? (Pro)
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And just like that … aid in the city
As one of our reporters listened to a World Bank side event on the future of European aid, she couldn’t help but wonder: Is the aid donor world getting a little … self-centered?
Elissa Miolene is no Carrie Bradshaw, but the question stuck. At a panel hosted by the Center for Global Development, she listened as aid officials from the United Kingdom and Belgium echoed the same tune: If development assistance is going to survive, it has to be seen as “mutually beneficial.”
“We will be doing less with less,” said Heidy Rombouts of Belgium’s Foreign Ministry. She predicted tough choices ahead and a push to prioritize public goods like climate, food systems, and global stability — but only when the benefits go both ways.
The U.K. Foreign, Commonwealth & Development Office’s Nick Dyer put it bluntly: The U.K. in the future would be “less of a donor, and more of an investor,” predicting a shift from grants and services to systems support and “a lot more focus on fewer areas” rooted in “mutual interest.”
All of this, of course, was said in Washington, D.C., ground zero for the “America First” aid philosophy. And that raised alarm bells.
“I worry that most of the aid industry espouses this win-win narrative, but in actual fact, it’s going to be more of a winner-takes-all type of approach,” warned CGD’s Mikaela Gavas. “I’m very concerned about the direction of travel.”
Background: Europe is cutting development spending, and it's not because of Trump (Pro)
Beyond rep-roach
Foreign aid: Cockroach under the plate or misunderstood delicacy? That’s the image a U.S. senator used when chatting with Daniel Runde of the Center for Strategic and International Studies, or CSIS — comparing foreign assistance to lifting your plate at a five-star restaurant and finding a cockroach underneath. “There are a lot of Republicans who are feeling this way,” Runde told a CSIS panel yesterday. “What’s my answer to that?”
Tessie San Martin of FHI 360 jumped in: “I hope that the answer to the cockroach under the plate is not: Well, let’s just burn the whole restaurant down. Then there’s no cockroach, and there’s also no restaurant.” Her point, Elissa tells me, was that Trump’s sweeping aid freeze and the dismantling of USAID were overkill. “Somewhere in between the tear-it-all-down and live-with-the-cockroach [approaches], there has to be a happy medium,” she said. “And it’s not necessarily what we’ve seen.”
DevTech’s Rafael Romeu had his own take: “I would push back that it was a cockroach. It was a conscious decision by the political masters at the time.” Or as he quipped, “The cockroach is in the eye of the beholder.”
And if you're still thinking about that plate, Romeu reminded everyone: In some places, cockroaches are a delicacy.
Spring cleaning
IMF chief Kristalina Georgieva delivered a clear message to countries worldwide on Tuesday: Get your own house in order.
“There are reforms on the fiscal side, there are actions related to financial stability ... that taken together can give you a better standing in a world of frequent shocks,” she said at the Spring Meetings, urging countries to brace for volatility — and do the hard work now.
She called for more regional cooperation, especially in places such as the Gulf, Africa, and Southeast and Central Asia, pointing out that there are “obviously ways of stepping up trade among neighbors and creating better conditions for capital flows across borders.”
“It is very simple,” she added. “Take challenge; make opportunity.”
Georgieva reminded everyone the IMF was built for messy moments like this, my colleague Jesse Chase-Lubitz tells me. And with a Global Policy Agenda in hand, she’s pushing structural reforms that let the private sector take the wheel. “We have already discussed it among the board of directors and I can tell you that the reaction was very positive,” she said.
+ Explore our coverage of the 2025 World Bank-IMF Spring Meetings.
In other news
Israeli airstrikes on Gaza have killed at least 40 people, including several in a school-turned-shelter, in the last 24 hours, according to local sources. [Al Jazeera]
The World Bank has signed two concessional loan deals with Bangladesh worth $850 million to boost trade capacity, spur job growth, and support 4.5 million vulnerable people. [Reuters]
Millions of women and girls remain excluded from the digital world, with 189 million fewer women than men online in 2024. [UN News]
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About the author
Helen Murphy
Helen is an award-winning journalist and Senior Editor at Devex, where she edits coverage on global development in the Americas. Based in Colombia, she previously covered war, politics, financial markets, and general news for Reuters, where she headed the bureau, and for Bloomberg in Colombia and Argentina, where she witnessed the financial meltdown. She started her career in London as a reporter for Euromoney Publications before moving to Hong Kong to work for a daily newspaper.
