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A new programme to boost the climate resilience of drought-hit farmers in Iraq. Electricity installations that would give millions across Southern Africa access to clean energy. The conservation of critical ecosystems in Honduras to help local communities improve their livelihoods at home instead of needing to migrate to countries like the United States.

These and hundreds more climate programmes funded by the US government risk disappearing as an administration led by President Donald Trump and tech billionaire Elon Musk threatens to shutter the state aid agency, USAID, and slash overseas development assistance.

“I think this is the end of US [government] climate funding,” predicted Karen Mathiasen, a project director with the Center for Global Development, a Washington-based think-tank. In an interview with Climate Home, she described as “shocking” the speed and brazenness with which the government is attempting to dismantle its foreign aid arm.

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Aid organisations and contractors have been grappling with an unprecedented crisis since, on his first day in office, Trump ordered a 90-day funding freeze during which a programme-by-programme review would be carried out.

As the world’s largest bilateral development assistance agency, USAID is a major provider of grant-based finance for climate action in the Global South. Its climate programmes – amounting to close to half a billion dollars in 2024 – help countries cut greenhouse gas emissions and protect their citizens from the escalating effects of global warming.

Secretary of State Marco Rubio – who is now in charge of USAID’s work – said last week that only projects that make “America safer, stronger or more prosperous” will survive the cull, without explaining which criteria would be used for the assessment.

‘Devastating’ consequences

The sudden move has thrown the development world into disarray, with organisations forced to halt their operations overnight and furlough or lay off staff without being able to obtain clear information or guidance from US officials.

A USAID project in Honduras strengthens the sustainability of coffee farming. Credit: USAID/Honduras Transforming Market

Speaking to Climate Home, aid workers involved in USAID-funded climate projects in the Global South painted a picture of bewilderment and confusion.

“We are no longer able to transfer funds to our local partners – and it will be really hard for them to manage costs,” explained one senior official at a global humanitarian group, underscoring the “devastating” consequences of the funding freeze for frontline organisations.

Working in conflict-afflicted regions, the aid group supports projects to build climate resilience that struggle to attract any financing outside of development money, said the official, adding “that has all gone away now”.

“For many programmes a 90-day pause is as good as a cancellation because you lose all momentum, you lose community connection, you lose the trust you built up with communities which is vital to success,” they added.

Separately, in Malawi, Climate Home has learned that all USAID-funded projects have been halted, with staff members being told to remain at home, just as the country was hit by deadly floods last week.

Climate aid powerhouse

Climate Home analysed USAID’s portfolio of climate projects before its website went offline late last week, soon after Trump-ally Musk, the world’s richest man, labelled the agency as “a criminal organisation”, without providing evidence – and called for its closure.

One of USAID’s single largest climate projects supports the large-scale roll-out of clean energy facilities across Southern Africa. With total budgeted funding of $84.5 million up to 2028, the programme aims to set up 3 million new electricity connections and avoid 14 million tonnes of planet-heating emissions – equivalent to the annual carbon footprint of Ivory Coast.

Other large US-backed renewable energy projects target Central Asia, Eastern Europe, Ecuador, Colombia and Bangladesh. The vast majority of these are implemented by profit-making American corporations that would be financially hit by any funding cuts.

Climate adaptation also features prominently in USAID’s portfolio. In the last year alone, the agency committed $22 million to boost the ability of farming communities in Iraq to deal with climate-related drought and $18.5 million to help the adoption of climate resilience measures in Palestine. Similar initiatives have been in place in dozens more countries across the Pacific, South Asia, sub-Saharan Africa and Latin America.

Many other USAID projects include climate-related activities – even if they are not explicitly labelled as such – especially in very fragile and conflict-affected regions.

“No future”

It is impossible to predict what will happen to USAID and its thousands of programmes in what is a fast-changing situation – although many staff are due to be placed on administrative leave at the end of this week amid rumours it will be be folded into the State Department. Any fundamental reforms of the agency, and especially its touted abolition, would legally need to be approved by the Republican-controlled Congress.

But, as far as climate action is concerned, some experts believe the writing is already on the wall.

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Along with the wider funding freeze, on his January 20 inauguration day Trump explicitly ordered federal agencies to explain how they would “revoke or rescind” policies implemented to support his predecessor Joe Biden’s international climate finance plan.

“I see no future [for climate projects],” the humanitarian official said, speaking anonymously due to the sensitivity of the situation, adding that it remains to be seen whether some resilience-building activities could be woven into humanitarian assistance, which is more likely to be continued. “But anything that talks significantly, or even marginally, about climate change doesn’t have a future.”

CGD’s Mathiasen, who offered a similar view, said adaptation finance stands to suffer the most severe consequences from the aid pullback. “It will further create further challenges to an agenda that’s already horrendously underfunded, while needs are real and growing,” she added.

The outlook might be less gloomy for renewable energy projects which offer higher returns and could more easily tap other financing sources. For instance, in sub-Saharan Africa, development banks have committed more than $50 billion to an ambitious “Mission 300” initiative aiming to provide 300 million energy-poor people with electricity by 2030.

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“It is hard to tell yet [what will happen],” said Saliem Fakir, executive director of the Africa Climate Foundation, “but generally large power projects rely on multiple funders – and we also have significant flows of funds from the Gulf States.”

Other major global powers, like China, might be looking to fill the gap as developing nations conclude they can no longer rely on US funding. “The US reputation will suffer as the US will be seen as an unreliable partner and a non-rational actor,” said Mathiasen. “For that reason, this is extraordinarily short-sighted”.

Climate finance goals harder to reach?

Faten Aggad, executive director of the African Future Policies Hub, told Climate Home that an “unprecedented” shift in international aid flows should prompt recipient countries to reevaluate their policies.

“It is a reminder that ODA [overseas development assistance] is not an economic development strategy,” she said. “Countries will need to work on structural solutions to fund their needs, and that includes looking beyond direct financial transfers from development partners.”

But, in the near-term, it will be difficult to quickly find alternative sources of finance for projects dependent on US grants, Aggad warned.

A US retreat from aid funding could also significantly affect the ability of developed countries to fulfill their promise of channelling at least $300 billion a year in climate finance to developing nations by 2035 – an agreement struck just over two months ago at COP29.

In 2022, US contributions accounted for 12% of developed countries’ climate finance through bilateral channels and multilateral climate funds under the previous $100-billion annual goal, according to analysis by US-based think-tank the Natural Resources Defense Council.

In comments made last week, Ani Dasgupta, president and CEO of the World Resources Institute, said “it is still too early to tell what US cuts will mean for reaching the $300-billion and $1.3-trillion [climate finance] goals by 2035 – but they may impact the pace of the scale-up.”

(Reporting by Matteo Civillini; additional reporting by Vivian Chime; editing by Megan Rowling)

The post “No future”: Climate projects face existential threat after Trump’s aid shutdown appeared first on Climate Home News.

“No future”: Climate projects face existential threat after Trump’s aid shutdown

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For the retired shrimper, the 8,000-mile trip to Formosa Plastics’ annual shareholder meeting in Taipei was part of a strategy of being relentless.

Story and photos by Dylan Baddour

The Resistance, Part 2: Three Gulf Coast environmentalists confront Formosa Plastics Corp. at its shareholders meeting.

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June 10, 2026

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The U.S. government’s recent deployment of visa restrictions for international illegal fishing exposes a dichotomy between how it wields power at home versus away.

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Brazil jostles for rare earths share as US-China rivalry heats up

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June 10, 2026

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Brazil is rushing to regulate its critical minerals industry and unlock its vast untapped reserves of rare earths, aiming to position itself as a strategic producer with Chinese and US companies competing for fresh supplies.

Despite opposition from some environmental and Indigenous rights groups, lawmakers in Brazil’s lower house of Congress passed the government’s critical minerals policy bill last month, and backers now hope to secure final Senate approval before October’s presidential election.

Already a major mining nation with large reserves of graphite and copper, Brazil has the world’s second-largest reserves of rare earth elements after China, with the difference that Brazilian reserves are largely untapped. This group of 17 minerals is used in permanent magnets for electric motors vital for clean technologies such as electric vehicles (EVs) and wind turbines.

As Chinese and US companies compete to secure supplies, Brazil hopes to serve them both.

“We don’t have any preferences. Whoever wishes to participate with us to help with the mining, processing, and production of the wealth that these rare earths can bring is welcome to invest in Brazil,” President Luiz Inácio Lula da Silva told journalists after meeting President Donald Trump in Washington in May.

Value-added mining

The draft legislation, which is backed by industry groups, creates a $380-million Guarantee Fund for Mineral Activity meant to provide financial support for mining projects, grants priority status for permitting strategic mining projects, and requires companies to dedicate a share of their revenue for domestic research and development on mineral extraction and processing – part of the policy’s effort to maximise the benefits of mining.

To select strategic projects and support their environmental licensing, the bill envisions establishing a Committee for Strategic and Critical Minerals, which includes representatives from different government agencies, state and local governments, industry and civil society.

Mining Minister Alexandre Silveira said the government’s bill “aligns mineral exploration with national interests”, and he has pledged to work closely with the Senate to pass it in the coming months.

“Brazil … doesn’t intend to be a mere exporter of unprocessed raw materials, but to expand its industrial and technological capacity, too,” Silveira said last month.

The Brazilian government says the country presents an “unparalleled” opportunity for refining “green minerals”, given that around half of its electricity comes from hydropower.

At the other end of the supply chain, several Chinese companies have vast plans to assemble EVs in Brazil. EV manufacturing giant BYD opened a massive production facility in the state of Bahia last October – the company’s largest EV factory outside China. BYD’s top executive in Brazil told Reuters it is aiming to produce and source 50% of its vehicle components in the country by the end of the year. BYD’s subsidiaries in Brazil directly own mineral rights in the country’s “lithium valley”.

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Some pro-government lawmakers had proposed the creation of a state-owned agency that would hold a monopoly over mining projects, but that was eventually rejected after the federal government decided that no additional state intervention was needed in the sector.

Mônica Sodré, CEO of the Brazilian Center for International Relations (CEBRI), said the country’s mining rules were created when minerals were mainly seen as “commodities for export”. Today, they are “central to economic security, industrial policy and geopolitics,” she said.

The proposed legislation, she added, is “an important first step, not a final solution” to position the country as a major mineral producer, and developing projects will require continued efforts through the newly-created committee.

Soft on safeguards?

But despite the government’s pledges to develop a critical minerals sector that benefits the national interest, some environmental groups have opposed the critical minerals policy bill, saying it does not create enough safeguards for the protection of affected communities.

Adriana Pinheiro, public policy advisor with Observatório do Clima, a network representing 130 environmental nonprofits, told Climate Home News that the bill “lacks explicit provisions on free, prior and informed consultation”.

    The Articulation of Indigenous Peoples of Brazil (Apib) said in a note to Congress that the bill has the “potential to significantly impact indigenous territories without adequately incorporating mechanisms for protection and participation”.

    Sodré said the concerns are valid, but that the draft bill is not the place to address them. Instead, she said, indigenous rights and participation should be considered on a project-by-project basis and that safeguards exist under Brazil’s “extensive” environmental permitting legislation.

    “Precaution is essential in mining policy, but it should not lead to inaction. Blocking investments or delaying projects without clear evidence of unacceptable risks can result in significant social and economic costs,” she said.

    Pinheiro, of the Observatório do Clima, added that while the bill encourages domestic processing of critical minerals, it does not create mandatory quotas. Countries such as Indonesia and Zimbabwe have banned raw exports, forcing investors to set up processing plants in the country.

    “This regulation is only positive if it combines industrial strategy with strong safeguards,” Pinheiro said.

    Geological advantage

    China extracts about 70% of the world’s rare earths and controls around 90% of the processing – creating a potential chokepoint that has alarmed Western countries at a time of heightened geopolitical tension. The US and China have opted to stockpile key minerals in case trade restrictions are enacted against them.

    Brazil, which has strong trade and diplomatic ties with both Beijing and Washington, views the intensifying competition for rare earth supplies as an opportunity for it to develop a new mining sector. Brazil’s National Mining Agency has reported about 2,700 rare earths projects under consideration, according to local news outlet Folha de Sao Paulo.

    The country’s rare earths reserves also have a geological advantage, as they are predominantly contained in ionic clay rather than hard rock. These deposits contain sought-after “heavy rare earths” and require less processing to extract.

    Workers of Sigma Lithium Corp SGML.V are seen at the Grota do Cirilo mine in Itinga, in Minas Gerais state, Brazil April 18, 2023. REUTERS/Washington Alves

    Workers of Sigma Lithium Corp SGML.V are seen at the Grota do Cirilo mine in Itinga, in Minas Gerais state, Brazil April 18, 2023. REUTERS/Washington Alves

    Backed by $2.7 billion in financial support from US government agencies, American mining firm USA Rare Earths acquired Brazil’s Serra Verde group, which owns the high-grade Pela Ema mine. The ionic clay mine is the only one outside Asia capable of supplying all the four major rare earths at scale, according to the company’s CEO Barbara Humpton.

    Other major firms have followed, with Canada’s Aclara conducting studies in the $680-million Carina mine and Australian companies Meteoric and Viridis also seeking to develop ionic clay mines for European and American buyers.

    Despite growing Western investments, China remains Brazil’s largest trade partner and the country’s imports from Brazil have already tripled between 2024 and 2025, according to data by the Brazil-China Business Council.

    The draft bill does not guarantee that Brazil will be able to compete with Chinese rare earths on the international market, Sodré noted. A “more realistic benchmark” is how effectively the country can position itself as major supplier of critical minerals for the energy transition, she added.

    Pinheiro said clearer regulation may help shape investments into the country, but foreign companies will not necessarily wait for Brazil’s critical minerals policy.

    “The central question is whether Brazil will use this moment to build domestic value chains, ensure socio-environmental safeguards and protect affected communities,” she said.

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