US withholds $65 mn from Palestinian aid programs: State Dept

The Trump administration has cut tens of millions of dollars in money for Palestinian refugees, demanding that the UN agency responsible for the programs undertake a "fundamental reexamination," the State Department said. In a letter on Tuesday, the State Department notified the UN Relief and Works Agency that the US is withholding $65 million of a planned $125 million funding installment to the body. The letter also makes clear that additional US donations will be contingent on major changes by UNRWA, which has been heavily criticised by Israel.

"We would like to see some reforms be made," said State Department spokeswoman Heather Nauert, adding that changes are needed both to the way the agency operates and is funded. "This is not aimed at punishing anyone."

The State Department said it was releasing the rest of the installment -USD 60 million -- to prevent the agency from running out of cash by the end of the month and closing down. The US is UNWRA's largest donor, supplying nearly 30 percent of its budget.

The agency focuses on providing health care, education and social services to Palestinians in the West Bank, Gaza Strip, Jordan, Syria and Lebanon. Hundreds of thousands of Palestinians either fled or were forced from their homes during the war that led to Israel's establishment in 1948. Today, there are an estimated 5 million refugees and their descendants, mostly scattered across the region.

The US donated USD 355 million to UNWRA in 2016 and was set to make a similar contribution in this year; the first installment was to have sent this month. But after a highly critical January 2 tweet from Trump on aid to the Palestinians, the State Department opted to wait for a formal policy decision before sending its first installment.