The U.N. refugee agency plans to scale back its budget by nearly a fifth next year due to “financial constraints”, even as the war in Sudan and other crises cause a surge in people fleeing their homes, its projected budget showed.

The UNHCR agency also plans to close its Southern Africa bureau and scrap nearly 4,000 jobs as cuts leave it with $8.5 billion to spend in 2026, down from $10.2 billion in 2025, according to the document published online on Monday.

It did not go into details on the constraints. Aid agencies have been rocked by funding cuts from major donors, led by the United States and other Western powers which have prioritised defence spending prompted by growing fears of Russia.

The Geneva-based body expects the number of forcibly displaced and stateless people to rise next year to a new global record of 136 million, up from 129.9 million in 2024.

The closure of the bureau in South Africa’s capital Pretoria will take effect on October 1 and offices in East and West Africa will absorb its operations, the document said.

Southern Africa hosts refugees fleeing conflict in the Democratic Republic of Congo and those displaced by the northern Mozambique insurgency. The regional office employed 72 staff, according to the document, and covered 16 countries.

“We have already started seeing the impact of reduced funding across different operations,” said Duniya Aslam Khan, UNHCR spokesperson for Southern Africa.

“If we were giving cash assistance, it’s reduced cash assistance. Health care services have been affected. Education programs have been affected. Food assistance has been affected.”

Closing the regional bureau was considered the best option to reduce costs and maintain a strong field presence, Khan said.

The United States has historically been by far the largest donor to the UNHCR.

The U.N. World Food Programme, which previously relied on the U.S. for nearly half its budget, also closed its Southern Africa bureau citing funding constraints earlier this year.