What Happened

A federal program that helps American businesses win contracts overseas and funds development projects in poorer countries faced tough questions in Congress last week. The House budget hearing on trade and investment agencies, held Sept. 16, focused on a White House proposal to slash funding for the Millennium Challenge Corporation (MCC), a U.S. government agency that partners with developing countries on infrastructure and energy projects, by 76 percent in fiscal year 2027. [](#ngr-2ab67b09-2ab6-4188-ac63-b6074544853c)

The administration's budget request pairs that deep MCC cut with roughly $277.5 million for two other trade agencies: the Export-Import Bank (EXIM), which helps finance American exports, and the U.S. International Development Finance Corporation (DFC), which backs private-sector investment in developing countries. The DFC request also includes $3 billion in separate mandatory money for a revolving investment fund, and approximately $804 million in combined DFC program and administrative funding.

Why Does It Matter To Me

They support American jobs by helping U.S. companies compete for contracts in foreign markets, and they build the kind of goodwill and economic ties that can stabilize regions where instability often drives up global energy and food prices.

The DFC, for example, reported delivering more than 275,000 new energy connections in Kenya and improved sanitation for 2.2 million homes in India during fiscal year 2025 alone, according to testimony from Conor Coleman, DFC's head of investments. The MCC, meanwhile, recently selected five new partner countries across the Indo-Pacific and Western Hemisphere, according to Dan Petrie, MCC's acting chief of staff.

Both Sides, Now

Petrie defended MCC's model at the hearing, describing its programs as time-limited, cost-sharing, and held to strict accountability standards. He pointed to active projects in Guatemala, Bolivia, Ecuador, Fiji, and Tonga, including infrastructure and energy work.

The administration's DFC strategy, as described in its fiscal year 2026-2030 strategic plan, centers on private-sector investment and countering strategic competitors, framing DFC as a tool of the president's America First foreign policy. The Center for Global Development, a nonpartisan research group, notes that MCC has historically drawn bipartisan support in Congress, though it also observes that congressional backing did not prevent the dismantling of a separate foreign aid agency in recent years. Congress holds the power to approve, reject, or rewrite the administration's budget request. No committee vote or formal funding decision came out of the Sept. 16 hearing.

The U.S. Trade and Development Agency (USTDA), a smaller agency that funds feasibility studies to help U.S. exporters, also appeared at the hearing. Its fiscal year 2027 request of $77 million would be $10 million below the $87 million Congress approved for fiscal year 2026, according to the U.S. Global Leadership Coalition.

What Happens Next

Congress must still pass a spending bill for fiscal year 2027, which starts Oct. 1, and lawmakers on the House Appropriations Committee will ultimately decide whether to accept, modify, or reject the proposed MCC cut. No committee vote on the trade agencies' budgets is currently scheduled.

If Congress does not act before the fiscal year deadline, the agencies would likely operate under a temporary spending measure that holds funding at current levels, leaving the MCC cut in limbo.

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This article was generated by AI pulling from data. Each article is edited by an editor for accuracy and clarity.

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