The recent dismantling of USAID and uncertainty surrounding U.S. foreign aid pose challenges for businesses reliant on these funds in developing markets. Historically, U.S. foreign aid has shaped the business environment by supporting capacity building, knowledge exchange, and stable payment norms. Without these vital resources from USAID, companies may find it difficult to operate efficiently, as late payments and lack of infrastructure could destabilize their market operations. Additionally, the void created by these changes might result in reduced knowledge transfer for many small and medium enterprises, impacting their productivity and access to resources.
Moreover, U.S. foreign aid has played a crucial role in establishing business norms and relationship dynamics between companies and governments. Companies involved in global supply chains have benefited significantly from USAID programs, which have fostered payment discipline and market intelligence. The transition away from these supportive structures raises questions about the future of business in developing markets and emphasizes the need for companies to explore alternative strategies for growth and collaboration. The urgency for collective action among businesses is underscored to mitigate the risks associated with reduced foreign aid while striving for sustainable development and economic stability.
👉 Pročitaj original: MIT Sloan Management Review
