Exclusive: Elon Musk USAID shutdown move halts $400 million in aid allocated for Gaza, Darfur
Elon Musk, the world’s richest man and Trump ally, is pushing sweeping federal institutional reforms, and has openly expressed his intention to shut down USAID
A sign depicting Elon Musk is seen at a rally in Upper Senate Park in response to the disruption of USAID to demand that congress and President Trump act to restore foreign aid, on Wednesday, February 5, 2025. (Getty)
The United States has suspended the transfer of $400 million designated for humanitarian and food aid in the Gaza Strip, according to a senior U.S. official who spoke exclusively to our Arabic edition Al-Araby Al-Jadeed on condition of anonymity.
The aid was scheduled to be sent Monday through the U.S. Agency for International Development (USAID). However, the shutdown the agency’s accounts and the blocking of agency employees from accessing their accounts worldwide led to the suspension of the transfer.
According to a memo reviewed by Al-Araby Al-Jadeed, U.S. Secretary of State Marco Rubio approved the continuation of certain foreign development aid on January 29, following a swift review. However, the decision did not explicitly state that the aid was designated for Gaza. Instead, it specified that the funds were intended for “life-saving humanitarian assistance, including access to essential medicines, medical services, food, shelter, and livelihood support, as well as reasonable administrative costs and supplies.” The source clarified that the exemption signed by the Secretary of State was specifically intended to facilitate the delivery of food and medical aid to both Gaza and Darfur.
The approval was issued on January 29, and USAID employees immediately began processing the transfer of funds to Gaza. The money was set to be sent on Monday, February 3, following the completion of necessary approvals and administrative procedures. However, the closure of USAID employees’ email accounts by the Department of Government Efficiency halted the transfer, preventing funds from reaching medical institutions and humanitarian organizations responsible for providing food and medicine to Gaza’s residents.
The senior official told Al-Araby Al-Jadeed, “Elon Musk, who announced the agency’s shutdown and suspended its operations, effectively overturned U.S. Secretary of State Marco Rubio’s decision, preventing the transfer of crucial funds meant to save lives in Gaza and Darfur.”
The source further revealed that “some officials made last-minute efforts to push the aid through, and senior agency staff were in tears over their inability to transfer the funds,” emphasizing that “this money could have saved thousands of civilians in Gaza.”
According to a report by New York magazine, USAID’s final transaction before its shutdown involved an employee authorizing approximately $78 million on Sunday night for food, medicine, and shelter for Palestinians in Gaza—just two hours before their email account was disabled.
The magazine reported that USAID was only able to authorize this sum due to U.S. obligations under the ceasefire agreement between Israel and Hamas, which was negotiated by President Donald Trump’s envoy, Steve Witkoff.
The magazine also cited three sources within USAID who stated that the $78 million earmarked for Gaza still requires final approval.
However, the senior official who spoke to to Al-Araby Al-Jadeed confirmed that the funds have yet to be transferred.
Humanitarian organizations are now sounding the alarm over an imminent crisis following the U.S. administration’s decision to suspend a significant portion of foreign aid.
The International Medical Corps anticipates halting its operations in Gaza this week, affecting critical services such as pediatric surgeries, emergency care, and intensive care units following the suspension of U.S. assistance provided through USAID.
Last week, the organization issued a formal warning that its operations in Gaza would cease within two weeks due to funding shortages. It also confirmed that, since October 7, 2023, it had received approximately $68.078 million from USAID.
In a statement to Al-Araby Al-Jadeed, the organization confirmed that the situation remains unchanged, as outlined in its January 29 report. It said American aid was allocated to operating two large field hospitals in central Gaza—one in Deir al-Balah and the other in Al-Zawaida—offering a combined capacity of over 250 beds, including 20 in the emergency department and 170 in surgical units.
“If U.S. government funding ceases,” the organization stated, “many essential services at our hospitals will be shut down, including safe childbirth for approximately 20 babies per day and around 30 life-saving surgeries daily. These include limb-saving, abdominal, and spinal procedures, emergency cesarean sections, and complex wound treatments. The closure will also affect one of Gaza’s only neonatal intensive care units, which provides specialized care for newborns, as well as a stabilization center for children suffering from severe malnutrition. Additionally, the emergency department—treating nearly 200 patients daily—along with the outpatient clinic, which serves approximately 2,000 patients daily, will be forced to shut down.”
On January 24—just four days after Donald Trump’s return to the White House—NGOs working with USAID received an email instructing them to halt all agency-funded activities. A week later, a second email permitted the continuation of select “essential humanitarian aid” services, including the provision of “basic medicines, medical services, shelters, and livelihood support,” as well as emergency water, sanitation, and hygiene projects. However, the vague language in these communications has left humanitarian organizations uncertain about their funding status, while USAID itself faces severe financial constraints.
Elon Musk, the world’s richest man and Trump ally, is pushing sweeping federal institutional reforms, and has openly expressed his intention to shut down USAID, describing it as being run by “a bunch of extremist lunatics.” Shortly thereafter, Secretary of State Marco Rubio appointed himself acting head of the agency, vowing to put an end to what he termed “insubordination” within the institution.
