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USAID Cuts Leave Nepal Aid Workers Unemployed and Pushed Into Sex Work

The loss of U.S. funding has shuttered local HIV-prevention services and created acute health and safety risks for former aid staff.

Dusk sets over a restaurant where transgender sex workers meet clients along a busy highway in Hetauda, Nepal, Wednesday, May 20, 2026. (AP Photo/Bram Janssen)
Barsha Magar, a former aid worker who turned to sex work to survive after losing her job amid the U.S. foreign aid cuts, poses for a photo, Sunday, May 17, 2026, in Hetauda, Nepal. Magar spent 16 years as an HIV outreach worker and peer educator for the NGO Friends Hetauda before turning in desperation to sex work, where she has been raped at gunpoint. (AP Photo/Bram Janssen)
Manisha Dhakal, executive director of the Blue Diamond Society, Nepal's leading LGBTQ+ advocacy group, sits in her office, Wednesday, May 13, 2026, in Kathmandu, Nepal. (AP Photo/Bram Janssen)
Colorful buildings sit along a main road in Hetauda, Nepal, Thursday, May 14, 2026. (AP Photo/Bram Janssen)

Overview

  • The Associated Press published on July 23 first-hand reporting from Hetauda showing 15 former aid workers, many LGBTQ+ and transgender, have turned to sex work after losing NGO jobs tied to U.S. aid.
  • President Trump’s decision last year to dissolve USAID is linked to the elimination of roughly 280,000 humanitarian posts worldwide and an estimated 35,000 job losses in Nepal, local leaders say.
  • The Blue Diamond Society reports it lost about 85% of its funding, leaving 262 of 350 staff without work and more than 1,200 clients without access to PrEP and other HIV-prevention services.
  • Former aid workers describe widespread violence, including assaults and gang rape, frequent police harassment, forced unprotected sex for pay, and repeated job rejections when employers learn they are transgender.
  • The U.S. State Department defended a shift in assistance toward efficiency and partnership, while conservative commentators seized on the coverage to defend the cuts and public-health officials warned of possible increases in HIV transmission across the region.