USAID in Vietnam: Reflecting on a Year of Humanitarian Aid and Political Suspicion

US President Donald J. Trump and Prime Minister of the Socialist Republic of Vietnam, Nguyen Xuan Phuc, in Hanoi (27/02/2019). Photo from the White House of the United States by Joyce N. Boghosian

Introduction

The year 2026 marks the 65th anniversary of the establishment of the United States Agency for International Development (USAID), an organisation whose history is closely tied to the rise and fall of Vietnam-U.S. relations. USAID in Vietnam did not start in 1989 when the Patrick J. Leahy War Victims Fund (LWVF) was established, as suggested by the Vietnamese government and some media reports (Minh Phương, 2025). The organisation actually inherited US civilian aid programs for the Republic of Vietnam from the 1950s and officially operated under the name USAID from 1961, before being suspended at the end of the Vietnam War (National Archives and Records Administration, 2022; Nguyễn, 2025). By 1989, during the renovation era in Vietnam, USAID resumed its operations mainly with war reparations. Since then, projects involving university education, higher living standards among victims of war, dioxin contamination, and the improvement of identification techniques for war dead have been supplemented by USAID. Given the historical backdrop, the Trump administration's move to halt USAID aid at the end of January 2025 stirred up a major shift in U.S.-Vietnam relations. 

Through reflecting on the Vietnamese government's reaction to USAID aid and political suspension cuts after one year, this article aims to show that, while the Vietnamese Government expresses concern that the cut in international funding has affected war remediation, the Vietnamese government holds a complex stance towards USAID or, in a broader sense, its comprehensive strategic partner. On one hand, Vietnam demonstrates dependence on international aid during a period of global economic development, and the U.S. is one of its most important aid sources. On the other hand, political agencies of the Communist Party still view USAID as a tool to spread colour revolutions and help the U.S. achieve democratic reform in Vietnam, rather than fully considering the humanitarian nature of this organisation.

USAID cuts: A temporary shock disrupting humanitarian projects in Vietnam

In mid-February 2025, the Trump administration reduced the budget of the USAID program by 83%, causing many humanitarian projects, including projects related to Agent Orange in Vietnam, to be disrupted. Notably, this included the dioxin remediation program for Bien Hoa airport, one of the largest remaining pollution sites in Vietnam. This not only posed threats to the health of tens of thousands of people living near the Bien Hoa airport area, but there are also still more than 8,600 people suffering from diseases caused by Agent Orange (Maria et. al., 2025). More significantly, it has threatened the diplomatic success reached between the two countries after decades of reconciliation.

"This is another example of what many critics want to remind us," said Chuck Searcy, an American veteran who has now served in humanitarian programs in Vietnam for three decades after his time in Vietnam: "You can't trust the Americans." (Associated Press, 2025) However, after about a week, the funding for the Bien Hoa project was "unfrozen," although it remains unclear whether the funds are actually being fully disbursed now that there are no longer USAID staff to manage operations (Associated Press, 2025).

Paradox in perception: Between need and suspicion

The aforementioned event has opened a series of inconsistent actions across different departments within the Communist Party of Vietnam, reflecting a deep paradox in the approach and response to USAID cuts. In fact, Vietnam is in a situation where it is in great need of aid, because the $430 million dioxin clean-up project in Bien Hoa, which is scheduled for 10 years, is dependent on the Official Development Assistance (ODA) funds, which are sourced from the US (Tran, 2025). Secondly, according to Senior Lieutenant General Nguyen Chi Vinh, a project which is under the Ministry of National Defence is also dependent on “technologies and techniques that foreign countries [including the US] possess, while Vietnam is currently lacking them.” (Tran, 2025). Vietnam's Ministry of Foreign Affairs correspondent Pham Thu Hang reinforced this view on February 13, 2025, that the suspension of USAID-supported projects, especially landmine clearance and dioxin remediation at Bien Hoa airport, would have a significant impact on human safety and the environment (Vietnam News, 2025).

However, the propaganda arm of the Communist Party Politburo had a completely opposite reaction to the USAID cuts, expressing cynicism and believing that cutting this would help Vietnam avoid the US "democratic reform" process. The Communist Party Journal dedicated two articles to analysing USAID as a "colour revolution" tool, accusing this organisation not only of performing humanitarian aid but also of interfering in the internal affairs of countries, especially post-Cold War Soviet-aligned socialist countries, including Vietnam (Lê, 2025). Furthermore, the two articles focus on describing the potential relationship between USAID and the Central Intelligence Agency (CIA) in attempts to overthrow the political systems of socialist countries and on allegations that USAID was involved in experiments said to have been the source of the global transmission of the COVID-19 pandemic (Lê, 2025b). These articles also conceal all references to the massive capital that USAID has provided to Vietnam for war remediation projects.

Consequently, these inconsistent viewpoints have reflected the very fragile political relationship between Vietnam and the United States. While Vietnam receives significant economic benefits from the U.S., they also reflect concerns that foreign non-governmental organisations could become tools to promote Western-style "democratisation" within the country. Moreover, the different reactions between the Ministry of National Defence, the Ministry of Foreign Affairs, and the Politburo reflected a political system with certain ramifications and divisions within the Vietnamese Communist Party. 

The Way Forward: Self-Reliance in Dependence

Following the shock of the USAID cuts, there was little hope that USAID funding would return, as it was now tightly controlled by the US Department of State. Therefore, only projects directly benefiting the US government and diplomacy would be considered for support, rather than focusing on humanitarian aspects as before. The biggest lesson for the Vietnamese government after this event was the importance of self-reliance.

In fact, Vietnam has been able to sustain financial support from the US through memoranda of understanding signed with the US Secretary of War (formerly the Department of Defence) and the US Department of State to improve cooperation in responding to the effects of war (Trần, 2025). By mid-2025, the Bien Hoa project will have already excavated around 42,000 cubic meters of earth (achieving 70% of the planned progress). Vietnam has fortified bilateral relations with Japan, South Korea, and Italy to facilitate the transfer of mine-clearing technology (Trần, 2025). 

Moreover, Resolution No. 244/2025/QH15 on the Economic Growth Plan for 2026 reaffirmed the Vietnamese government's intention to become more self-sufficient and independent. There are three important determinations of the Vietnamese government’s intention to become independent. Firstly, the National Assembly has set a target of over 10% growth in its Gross Domestic Product (GDP) in 2026. They have also agreed to raise the inflation ceiling to achieve the objective more rapidly.

Secondly, the National Assembly has shown significant interest in investing in and developing technology and engineering across various levels in Vietnam. The national budget is not only heavily focused on investing in key technology projects but also on promoting groundbreaking scientific projects. The National Assembly emphasises that "innovation must create a nationwide movement, and digital transformation must build a digital nation and a digital government." This reflects the government's desire to overcome Vietnam's technological and engineering weaknesses.

Third, the National Assembly proposed several policies to more tightly manage the government apparatus and demonstrated a desire to attract and retain talented personnel through more generous benefits. All three objectives show efforts to change and overcome the consequences of the USAID trauma on Vietnam, including its economic potential, scientific and technological capabilities, and the growing divisions within the state apparatus.

Conclusion

Reflecting on the past year, the budget cut from USAID has underlined the beginning of a new era for Vietnam-U.S. relations across economic and political dimensions. In terms of the economy, the loss of USAID funding for important projects created financial and technical challenges. However, it did not take long for the Vietnamese government to access another source of ODA from other US agencies. This indicates that, while USAID is of utmost significance to Vietnam, there may be nothing more precious to the cooperation between Vietnam and USAID. On the political front, public responses from various governmental agencies indicate that Vietnam’s political system is not monolithic.

Ultimately, this event became the catalyst for the National Assembly’s 2026 historical policy, which seeks economic, technological, and ideological Independence within the state machinery. This is also an indication of the fact that the previous US intervention and Vietnam War continue to have an impact on most of the Vietnamese government administration, and this makes an unseen fence that will not allow complete trust within the relationship between Vietnam and the US anytime soon.

This article represents the views of contributors to STEAR's online digital publication, and not those of STEAR, which takes no institutional positions.

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