UN Palestinian refugee agency struggles to fund projects after US cuts

The UN Palestinian refugee agency needs more than $200m to fund projects until the end of the year, with extra pledges so far unable to minimise a massive slash in donations from the United States.

"Schools may not be able to open on time in August," Miroslav Lajcak, the president of the General Assembly, told a pledging conference for the UN Relief and Works Agency for Palestinian Refugees (UNRWA) in New York on Monday, the second such donors' meeting in three months.

"Other services could start to be affected as early as next month. And humanitarian activities in the West Bank and Gaza are at risk."

UNRWA was thrown into severe financial crisis when Washington cut $250m from its budget earlier this year.

Previous pledging conferences saw UNRWA so far meet around half its target of $446m for the year.

"Failure to provide desperately needed resources comes with a price. More hardship for communities. More desperation for the region. More instability for our world," said UN Secretary-General Antonio Guterres.

"We must do everything possible to ensure that food continues to arrive, that schools remain open and that people do not lose hope."

US Ambassador Nikki Haley has said Washington will not restore the aid until the Palestinians agree "to come back to the negotiation table" with Israel.

Guterres highlighted the importance of fundraising for the agency.

"Thanks to $200 million in new funding, UNRWA has been able to maintain its vital services. At the same time, UNRWA has taken extraordinary measures to reduce its expenditures by an additional $92 million," Guterres said.

On Monday, several countries announced new assistance, including $51m from the UK, $500,000 from Mexico and $4.68m from Belgium.

The UN defines Palestinian refugees as people who lived in Palestine and lost their homes and means of livelihood between 1 June 1946 and 15 May 1948, when the State of Israel was established.

The descendants of Palestinians displaced before 1948 can also register as refugees with UNRWA. The agency serves about five million people across Gaza, the West Bank, Syria, Lebanon and Jordan.

More than 500,000 children study at UNRWA schools - 54 percent of the agency's budget goes to education. UNRWA also provides medical assistance and welfare.

The agency employs more than 20,000 people in the Middle East, most of them Palestinians.

US President Donald has used humanitarian aid to Palestinians as a bargaining chip to promote his solution to the conflict, dubbed the "deal of the century".

"We pay the Palestinians HUNDRED OF MILLIONS OF DOLLARS a year and get no appreciation or respect. They don’t even want to negotiate a long overdue peace treaty with Israel," he tweeted in January.

The tactic has been criticised by rights groups.

"Of course, UNRWA, as an aid agency, is not a party to the peace process. But the administration seems intent on holding them hostage – and ultimately punishing vulnerable Palestinian refugees – as an indirect way to put pressure on the Palestinian Authority to join peace talks," Akshaya Kumar, deputy UN director at Human Rights Watch, wrote earlier this year.