US President Trump's controversial decision to freeze USAID funding for 90 days from January 23 has dealt a severe blow to humanitarian organisations supporting refugees in Mexico, coming at a time when new US border policies have increased demand for their services.

Mexico's Commission for Refugee Assistance (Comar), the government body responsible for processing refugee applications, faces a critical funding shortfall just as applications surge exponentially. Its 2025 budget of MXN47mn ($2.8mn) represents a reduction from last year's already insufficient MXN51mn, according to the Institute for Women in Migration.

The funding crisis has forced Comar to rely on external financing, particularly from the UN refugee agency UNHCR. However, Trump's foreign aid halt, which affects UN-linked international agencies including UNHCR, threatens this lifeline, putting more than 100 jobs at risk and endangering services for thousands of refugees.

Aid workers who spoke to bne Intellinews reported growing queues outside Comar's offices in Iztapalapa, Mexico City. Many of those waiting on February 13 said they now plan to remain in Mexico, believing the US border has become impassable.

Yusniel Cañizares Santana, 39, from Cuba, who was queuing with his wife and daughter, reported that they had decided to remain in Mexico now that Trump had shut the border. "I like Mexico, I like the life here," said Santana, who has found work at a local food market and is in the process of enrolling his daughter in school.

Others, however, were resigned to being in Mexico only as a temporary solution until trying to reach the US once security on the border relaxes. "I'm waiting for another way to enter," said Manuel Vasquez, 33, from Venezuela.

The impact extends beyond Comar. Lucía Chávez, director of Asylum Access Mexico, which provides legal aid and integration support to refugees, says the funding cuts will force staff layoffs and reduced operations.

"People are arriving in Mexico and we aren't going to have enough support to care for them," Chávez said.

"Our work is at serious risk because we are seeing deportations come and… at the same time, we are receiving migrants who want to remain in Mexico because there is no real opportunity to reach the US."

The crisis particularly affects grassroots support services that rely on USAID as their primary funding source. Casa Frida, an LGBT+ refugee organisation operating shelters in Tapachula, Chiapas, and Iztapalapa, Mexico City, receives 60% of its funding from USAID. Its director Raúl Caporal warns that vital programmes, including Program Rainbow which supports 1,500 refugees annually on Mexico's southern border, are at risk.

"These projects were focused on protection, care, and integration. Prevention of extreme violence, care for the mental health of victims, identification of victims, trafficking, among other project bases," Caporal told bne Intellinews.
Despite the immediate risk the freeze poses to Casa Frida’s work, Caporal remains concerned about the global implications of Trump's decision to pause humanitarian funding. 

"The US government contributes up to 40% of the total humanitarian aid worldwide, therefore, any modification, blockage or withdrawal of these funds puts at risk the stability, dignity, freedom and security of billions of people around the world," he said.

Meanwhile, across Mexico the aid cuts threaten not just refugee support but also public health initiatives, economic development, education and environmental conservation programmes. The situation there risks creating a perfect storm: overwhelmed agencies, understaffed programmes, and thousands of vulnerable people left without essential support.