US funding cuts along with reductions by UK, France, Germany and others, could double new displacements in 2025, according to Danish Refugee Council
Copenhagen, 1 July 2025 – New analysis by the Danish Refugee Council (DRC) shows that significant funding cuts by major donor countries, particularly to United States foreign assistance, will lead to a dramatic increase in forced displacements and leave millions without life-saving assistance.
Humanitarian and development assistance actively works to offset the factors that contribute to people fleeing their homes, directly impacting key drivers of displacement such as conflict, human rights violations, the effects of climate change, and economic crises.
The analysis – using the AI-powered Foresight model developed by DRC and IBM with Danish government funding – predicts that in a worst-case scenario where US funding is fully withdrawn and other donors also decrease funding, an additional 3.9 million people could be displaced in 2025 on top of the 3.95 million* people projected to flee their homes this year. The result would be a near doubling of total new displacements to a staggering 7.85 million.
In a less severe scenario, where US funding is cut by 50 per cent along with other planned cuts by donors, an additional 1.8 million people are projected to be displaced in 2025, bringing the total to 5.75 million.
These devastating cuts threaten to unravel years of hard-won progress in peacebuilding, humanitarian response, and development assistance, pushing millions more to flee their homes in search of safety. When funding is suddenly cut, lifelines are cut: The vital services that protect vulnerable communities from violence, hunger, and displacement abruptly disappear, leading to tragic consequences. We urgently call on donors to reconsider these cuts and work together to fill funding gaps before it’s too late.”
/ Charlotte Slente / Secretary General DRC
The US government’s sweeping termination of foreign aid contracts, amounting to 83 per cent of existing agreements, combined with reductions by the UK, France, Germany, and others, will disproportionately impact low-income countries already hosting the majority of displaced populations and battling socio-economic and climate crises. Afghanistan, DR Congo, Ethiopia, Sudan, and Yemen are expected to see millions of fewer people reached with essential aid services, exacerbating human suffering.
As the largest global donor, the US accounted for nearly 38 per cent of all development assistance and 46 per cent of humanitarian response funding in 2023.
The Danish Refugee Council underscores the critical importance of sustained donor commitments to peacebuilding and humanitarian aid which are the pillars that mitigate displacement drivers such as conflict, food insecurity, and human rights abuses. Increased support from countries like Denmark, Italy, Japan, and South Korea offers some hope but is insufficient to offset the broad-scale funding reductions by the US and others.
* The baseline projection of 3.95 million newly displaced people by the end of 2025 has been updated following UNHCR’s release of final 2024 data. This figure is on top of the current 122.1 million people forced from their homes due to conflict, disasters, and climate crises. In March of this year, DRC’s Global Displacement Forecast predicted 4.2 million displaced persons by the end of 2025 based on preliminary data from UNHCR and other sources.
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DRC’s Foresight model accurately predicts displacement trends by analyzing 148 indicators, based on economic, security, political, environmental, and societal factors, across 27 countries that represent 93% of all global displacement.