Palestinians for USAID: King Abdullah II’s Political Trade-off

Merely weeks into Trump’s presidency, Jordan has found itself on the brink of an existential crisis. To materialise Gaza as a profitable real estate project, the Trump administration has suggested that the 2 million Palestinian inhabitants be taken in by recognised Arab countries, specifically Jordan and Egypt. During his visit to the White House, on 11 February, King Abdullah II offered to open its doors to 2,000 injured children (BBC News, 2025). However, later, on social media, the King of Jordan categorically opposed Trump’s plan to displace Palestinians in Gaza (X, 2025).

Traditionally, Jordan has been recognised as a source of continuity in a region full of change. Consequently, Trump has pulled the rug from beneath King Abdullah II and forced him to confront the fragility of the Jordanian economy. In demanding more bang for his buck, Trump has re-negotiated the rules of bilateral aid. No longer satisfied with the previous conditions, the Trump administration expects Jordan to pull more of its weight. In this case, by taking on another one million Palestinian refugees.

Trump has little understanding of the strength of Palestinian nationalism and overestimates the likelihood that Palestinians would leave Gaza upon request. Nevertheless, Trump is attempting to use the United States Agency for International Development (USAID) as a bargaining chip. In his executive order, issued on 20 January, he ceased USAID to all countries, except Egypt and Israel, for a minimum of ninety days. It is uncertain whether Egypt might encounter the same fate if President Abdul Fattah al-Sisi were to refuse to take on more Palestinians. Parallelly, Jordan is facing an existential catch-22. If Trump is seriously conditioning USAID upon the intake of a million Palestinian refugees from Gaza, King Abdullah II will have the unpalatable choice of civic unrest by economic crisis or by a million more Palestinian refugees.

Jordanian Dependency on USAID

Since 1951, Jordan has received $32.5 billion in military and economic aid. For the US, Jordan is a strategic ally in the Middle East as the Hashemite dynasty provides a source of stability that welcomes US investment, a presence of US troops, and protects Israeli security interests. As a result, the US sits upon a three-legged stool of diplomacy, development and defence to safeguard its interests in Jordan, and the Middle East at large (Ingram, 2025).

Figure 1: US military and economic aid to Jordan from 2000 to 2024. Source: (US State Department, 2024).

Of the total aid, 86% has been provided since the turn of the century. Figure 1 illustrates the sheer volume of aid provided to Jordan at this time. Since coming to power in 1999, King Abdullah II has been heavily dependent on US military and economic assistance for political survival. Indeed, before Trump was inaugurated, Jordan expected to receive $2.1 billion worth of aid in Fiscal Year (FY) 2025, $1.71 billion in economic assistance and $390 million in military assistance (CRS, 2024).

It is almost certain that a collapse in bilateral aid will prevent progress in Jordan’s Economic Modernisation Vision 2023, a decade-long plan that hopes to improve social welfare, gender equality, sustainability and business entrepreneurship by 2033 (Jordan Vision, 2023). The plan presupposed the annual influx of aid as promised by the Memorandum of Understanding (MOU) signed in 2022, which offered Jordan $10.15 billion until FY2029 to achieve its targets (US Embassy in Jordan, 2024).

Figure 2: Categories of US economic assistance to Jordan for FY2024. Source: (US State Department, 2024).

Of the $1.309 billion of aid given to Jordan in economic assistance by the US in FY2024, 99.8% was provided by USAID. Therefore, the executive order pausing USAID for 90 days would mean the cessation of almost all programmes in Figure 2. The termination of aid is already having impacts on local, national and regional levels.

The impact of USAID’s termination

At the local level, several communities will suffer from the removal of aid. Communities that benefit from programmes designed to increase civic engagement, women’s empowerment and youth leadership, amongst others, will no longer receive organisational help. Considering that there are roughly 3 million refugees in Jordan (CRS, 2024) who directly rely on these services, the local impact of the aid cessation will be immense.

Termination of long-term educational projects and technical assistance to healthcare facilities will likely result in declining socioeconomic outcomes. NGOs are laying off thousands of local and international employees (The New Humanitarian, 2025). This exodus of foreign aid workers will damage the local economy and also leave many locals without any source of income. Therefore, Trump’s executive order will likely worsen the 22% unemployment rate (World Bank, 2024), and less welfare will consequently lead to higher rates of crime and social unrest.

Repercussions will be felt on a national level, too. Capacity-building efforts in the energy sector, as well as the Amman Aqaba Water Desalination project, contribute heavily to the maintenance of Jordanian infrastructure (US State Department, 2024). However, with less money in the local economy, businesses will experience a downturn in revenues and production.

Furthermore, assistance for economic reforms and budget support has historically been ensuring fiscal responsibility by the Jordanian government. Its import-reliant economy has been heavily dependent on USAID to reduce the budget deficit (World Bank, 2024). Therefore, it is unlikely that multinational corporations (MNCs) will invest in Jordan, considering how bleak its future appears without unimpeded USAID, which would only serve to exacerbate Jordan’s impending economic crisis.

Demonstrators in Amman last week, protesting President Donald Trump’s proposal to displace Gazans. (Lorenzo Tugnoli/FTWP)

Two crises of authority

Without the annual injections from USAID, ranging between $1.65 billion and $2.1 billion, Jordan is almost certain to encounter an economic crisis. This spells trouble for Abdullah’s legitimacy as a leader. So far, Jordan is average on the Rule of Law index, consistently ranking second or third in the region for Civil Justice, Criminal Justice, Order and Security, Fundamental Rights, Regulatory Enforcement and Absence of Corruption (World Justice Project, 2024). If socioeconomic conditions were to decline as a result of USAID’s termination, social unrest would likely surge. The question remains as to how the Jordanian monarchy would cope with such an event. Based on past cases of insurrection, such as during the Arab Spring, the monarchy would likely resort to more oppressive methods of consolidating power (Ryan, 2018).

However, should King Abdullah II accept more Palestinians, he would face significant political unrest. In addition to the registered 2.4 million Palestinian refugees in Jordan, there are many Palestinians with Jordanian citizenship (CRS, 2024). The seismic demographic shift would mean that Palestinians, from different sociocultural groups, account for more than a third of the Jordanian population. Firstly, the King would face pressure from Palestinians. With refugee camps swelling and basic services struggling to keep up with demand, social unrest will fester. Many would certainly consider him complicit in undermining the realisation of Palestinian statehood. Secondly, he would face opposition from the local tribes upon which his power rests. A sudden arrival of another million Gazans would revive the anti-Palestinian racism that once characterised the Jordanian Bedouin families (Yom, 2014).

King Abdullah II’s trade-off

For now, King Abdullah II is weathering the storm. He reaffirmed his position, alongside President al-Sisi of Egypt, that Palestinians are not to be displaced from Gaza (Arab News, 2025). In doing so, Abdullah has scored some political points at home, in Palestine, and in the remainder of the Arab world. However, elation may be short-lived as Trump has yet to decide if aid to Jordan will be permanently cut off after the ninety-day window.

There is a mixture of factors behind King Abdullah II’s trade-off, as Jordan may be banking on its geostrategic importance to guarantee continued aid. Furthermore, he may look to rally his fellow Arab nations to change Trump’s mind. Should this fail, he may look to the European Union (EU), International Monetary Fund (IMF), or Gulf states to supplement the fiscal hole. Meanwhile, the fate of the Palestinians in Gaza remains in the balance, and some have criticised King Abdullah II for political hedging rather than contradicting Trump openly (Middle East Eye, 2025). Nevertheless, how King Abdullah II manoeuvres the Trump administration’s approach to Gaza will determine the size of the economic crisis that Jordan might face.

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