By Daniel Hegedüs
The second part of this article analyzes the impact of the termination of US Government Assistance on the implementer landscape and the indirect political implications in the CEE region.
Read the first part here.
Impact on the Implementer Landscape
While a significant contraction of the civil society sector in Central Europe is expected, part of the implementer landscape has already largely disappeared as a result of the termination of US government civil society support. Development companies, such as Dexis, that implemented US assistance programs were the first to cease operations in the region, laying off nearly all their local personnel within a month.
What is more, a hold-up in NED’s congressional appropriation led it to suspend not only its operations in Central Europe but also its payments to its affiliated organizations. As a result, the National Democratic Institute (NDI), the International Republican Institute (IRI), and the Center for International Private Enterprise (CIPE) were forced to lay off most of their personnel in Europe. CIPE disbanded its regional office in Bratislava and NDI did the same with its regional office in Krakow. Although NED is now receiving part of its funding, it is unlikely that the three organizations will resume their activities in Central Europe anytime soon.
With the withdrawal of most US implementers that have been continuously active in the region for the past three decades, significant capacity-building and network-strengthening resources will be lost—resources that were once permanently available to local civil society.
Areas in which these organizations specialized, such as Roma empowerment and support for local issue-based coalitions (often focused on environmental protection) in the case of NDI, and countering foreign information manipulation and interference in the case of IRI, may be particularly affected.
While European implementers may assume some of these roles and support local civil society by fostering networking, transnational learning, and capacity-building, the limited availability of funds means this transition will not happen rapidly, nor will it be able to fully restore all lost capacities.
Indirect Political Implications
Beyond its direct financial consequences, the indirect political implications of the cessation of US democracy assistance and civil society support to Central Europe could significantly shape political dynamics in the region for the worse.
The newly incumbent US administration’s violation of the rule of law—dismantling independent federal agencies established by Congress in clear defiance of legal provisions, along with the anticipated publication of beneficiary data under the executive order on radical transparency, which could quite literally be a matter of life and death in restrictive environments like Azerbaijan, Belarus, or Russia—is
emboldening illiberal, autocratizing leaders in Central and Eastern Europe, such as Hungary’s Viktor Orbán, Slovakia’s Robert Fico, and Serbia’s Aleksandar Vučić.
Domestic and international developments are creating a highly dangerous and volatile situation in these three countries in particular. At home, their governments face increasing challenges to their illiberal rule, deviation from the European mainstream, and weakening legitimacy and popular support. At the international level, the new US administration does not want the United States to be a global champion of democracy and expresses sympathies for illiberal, radical-right, and authoritarian actors. This leaves the EU as the sole external democratic check on its member states and candidate countries in Central and Eastern Europe. Consequently, external constraints on authoritarian dynamics in the region are significantly weakening.
The combination of growing domestic pressure and an increasingly permissive international environment creates a dangerous and enabling context for heavy-handed authoritarian suppression of domestic dissent.
The recent police raids in Serbia against key CSO stakeholders were a clear warning sign about potential further escalation. In Hungary, the government is working to strengthen its “sovereignty protection” toolkit, and actions similar to those seen in Serbia cannot be ruled out in the run-up to the 2026 elections. In Slovakia, the fragility of the governing coalition prevents Fico from fully exploiting the opportunities created by international developments beyond political messaging. However, his weak position could lead him to take unpredictable responses in the event of a government breakup.
Looking Ahead
Considering all the aspects and implications of the termination of US foreign assistance funding, civil society in Central Europe—particularly in Hungary, Slovakia and Romania, but potentially also in Czechia and Poland—will find itself in a situation where it must intensify its efforts to defend liberal democracy, the rule of law, and fundamental rights just when illiberal and authoritarian forces are emboldened. At the same time, the scarcity of resources to compensate for the loss of US funding will severely limit their ability to do so.
This dual challenge may shape the short-term future of democratic politics and civil society in several EU member states in the region and will ultimately affect not only the democratic integrity of the EU but also its decision-making processes, given the potential blocking power of illiberal-authoritarian member-state governments—particularly in times that demand flexibility and responsiveness on its part.
A coordinated and mutually reinforcing response from EU civil society, institutions, and member-state governments is essential to prevent further autocratization of EU member states.
To advance this goal, the following policy recommendations should be considered by the relevant stakeholders.
Ideally, EU CERV funding for civil society should be increased; realistically, it must be maintained at least at current levels
in the next Multiannual Financial Framework (MFF) of the European Union, despite competing priorities. Civil society is an essential soft security stakeholder and plays a key role in strengthening Europe’s democratic resilience—one of the primary targets of the continent’s illiberal and authoritarian adversaries.
Democratic mainstream political forces should foster an enabling political environment for civil society and avoid campaigns that mirror the tactics of their illiberal, populist, and authoritarian counterparts.
The center-right European People’s Party (EPP) should refrain from adopting the radical-right playbook and launching attacks against financial support for fully legitimate CSOs in the European Parliament, the German Bundestag, and other European political institutions.
EU Member States and allies such as Canada and Norway should reconsider decoupling democracy assistance and civil society support from development aid and begin financing such programs in EU countries that have traditionally been ineligible for development aid.
While the termination of US foreign assistance has created a significant gap in development aid as well, European countries would be well advised to prioritize the defense of their own democracies—an existential area that has remained largely underfunded for decades.
With even previously well-financed, established CSOs and watchdogs on the brink of financial sustainability,
both public and private donors must find a new balance between supporting established watchdogs and fostering new grassroots civic initiatives, as well as strengthening civic activism in peripheral and rural areas.
The first group of organizations provides a crucial line of defense against illiberal, authoritarian tendencies, while initiatives in the second group are essential for building new majorities in support of the liberal democratic project—particularly in peripheral areas, which remain strongholds of illiberal populist parties. There is no simple answer to the question of where support should be directed. Donors must recognize that the sector’s dependency on existing funders has increased significantly due to US policies. Exclusive funding decisions favoring one area over another could lead to the elimination of entire cohorts of civic activism.
Given the devastating impact of the termination of US foreign assistance on the implementer landscape in Central Europe,
public and private donors should strive to preserve the remaining implementation capacities.
This is particularly crucial for sustaining key functions such as capacity-strengthening, transnational learning, and networking which these implementers fulfill aside of re-granting. Their role is essential in maintaining the civil society ecosystem, especially in countries where CSOs face the greatest pressure from illiberal, autocratizing governments within the EU.
Daniel Hegedüs is Research Affiliate at the CEU Democracy Institute and regional director for Central Europe at the German Marshall Fund of the United States.
