U.S. Funding Freeze Jeopardizes China-Focused NGOs, Threatening Transparency and Human Rights Advocacy

The suspension of U.S. foreign aid programs and grants under the Trump administration has placed China-focused research and advocacy organizations in jeopardy, raising concerns over the transparency of one of the most heavily censored countries in the world. Many NGOs working on labor rights, human rights documentation, media censorship, and civil society support have been forced to furlough staff and halt critical programs.

Shortly after Trump took office on Jan. 20, organizations received an official notification from the State Department informing them of an immediate suspension of funding. The notice warned that the freeze could be further formalized through an amendment terminating grants, instructing recipients to cease all related activities and cancel outstanding obligations where possible. This move follows a broader 90-day review of foreign aid programs ordered by Trump to assess their alignment with his administration’s foreign policy objectives.

China Labor Watch, a New York-based group monitoring labor rights, has been among those severely affected. Founder Li Qiang stated that without U.S. government funding, the organization must urgently seek alternative sources of support. With 90 percent of its $1 million annual budget dependent on U.S. grants, the group faces the possibility of layoffs and program suspensions. Most of its staff and consultants may have to be placed on leave or let go if new funding is not secured.

The funding freeze has also impacted NGOs that have played a key role in exposing human rights abuses in China. Some groups have contributed to United Nations reports, including a 2022 U.N. assessment on Xinjiang, which suggested that Beijing’s actions toward the Uyghur population could constitute crimes against humanity. Despite China’s routine denials of such allegations, these organizations have been instrumental in documenting evidence and advocating for international accountability.

NGOs operating in Taiwan and Hong Kong have also been hit hard. With China’s national security law leading to an extensive crackdown on civil society in Hong Kong since 2020, many groups relied on U.S. grants as a crucial funding source. Alternative financial support in the region remains scarce, further limiting their ability to continue operations. A representative from a Taiwan-based human rights organization, speaking anonymously due to the sensitivity of their work, described the funding cuts as a major setback.

Beyond the immediate financial strain, there are fears that the funding freeze could erode international alliances and bolster China’s global influence. Over the years, access to information from within China has become increasingly difficult, with authorities tightening restrictions on foreign NGOs and limiting civil society activities under national security concerns. Censorship has also expanded, restricting information flows and reducing the number of foreign journalist visas issued. Analysts warn that the termination of grants could contribute to an information blackout, further obscuring the reality on the ground.

Bethany Allen, head of the Program for China Investigations and Analysis at the Australian Strategic Policy Institute, highlighted the irreplaceable nature of these NGOs’ work. Unlike universities, think tanks, or private firms, these organizations conduct research and advocacy that no other entities replicate. She cautioned that their disappearance would mark a victory for Beijing’s efforts to suppress information.

As recently as December, the U.S. Bureau of Democracy, Human Rights, and Labor had solicited grant proposals for programs promoting freedom of expression, human rights, and the rule of law in China. With grants typically ranging from $500,000 to $1.5 million, these funds were intended to support democratic initiatives and protect fundamental rights.

Allen stressed that democratic governments must prioritize such efforts, arguing that cutting these grants to save costs would come at the expense of critical democratic principles.