The Eritrean government has ordered USAID to leave the country. An official statement has yet to be made by the government, but the decision has already been communicated to the US Ambassador and the USAID Director in Eritrea. USAID, or US Agency for International Development, is the United States Government's arm for international development and humanitarian aid. The Agency has been present in Eritrea since 1992, and was the main channel for providing food as well as development assistance to the Eritrean people.

In the past few days, government media in Eritrea has been waging a propaganda campaign against international aid providers and non-governmental organizations (NGOs) dubbing them agents of new colonialism. Under the title 'Relief Aid, the Other Face of Neocolonialism', the government media has broadcast and published a series of Western aid-bashing editorials.

On 11 May 2005, the government issued a proclamation, which introduced new restrictions on the activities of NGOs. These include the requirement for depositing two million US dollars (for international NGOs) and one million US dollars (for local NGOs) in Eritrean banks; prohibiting the channeling, through NGOs, of funds from United Nations or bilateral organizations (practically disallowing working relationships with NGO), and introducing new levies (taxes) on NGOs.

USAID, like all other bilateral and multilateral aid agencies, channels some of its development and humanitarian assistance through NGOs. The bulk of USAID food assistance is provided through the World Food Programme (WFP) and NGOs; whereas the coordination of the distribution is managed by the Eritrean Relief and Refugee Commission (ERREC.) In addition to humanitarian food and non-food assistance, USAID's support to Eritrea covers such areas as Health and HIV/AIDS services, economic growth & reducing food insecurity, and creating jobs through small and medium business development in rural areas.

The U.S. Government is the largest donor of food aid to Eritrea.