The U.S. Agency for International Development (USAID) has ceased all assistance to Palestinians in the West Bank and Gaza, a U.S. official said on Friday.
The halt was requested by the Palestinian Authority but is certain to bring further hardship to people in the already deprived territories.
The deadline also sees the end of about $60 million in U.S. aid for the Palestinian security forces, whose cooperation with Israeli forces helps maintain relative quiet in the Palestinian areas in Yehudah and Shomron.
The decision was linked to a Jan. 31 deadline set by new U.S. legislation under which foreign aid recipients would be more exposed to anti-terrorism lawsuits.
The Anti-Terrorism Clarification Act (ATCA) empowers Americans to sue foreign aid recipients in U.S. courts over alleged complicity in “acts of war.”
President Donald Trump’s Middle East envoy, Jason Greenblatt, said the aid was cut at the request of the Palestinian Authority.
“This aid was cut (not just suspended) at the PA’s request because they didn’t want to be subject to U.S. courts which would require them to pay U.S. citizens killed by Palestinian terrorists when the PA was found guilty,” he said in a tweet.
The Palestinian Authority declined further U.S. funding over worries about its potential legal exposure, although it denies Israeli accusations that it encourages terror attacks.
“At the request of the Palestinian Authority, we have wound down certain projects and programs funded with assistance under the authorities specified in ATCA in the West Bank and Gaza,” a U.S. official told Reuters on Friday.
“All USAID assistance in the West Bank and Gaza has ceased.”
It was unclear how long the cessation would last. The official said no steps were currently being taken to close the USAID mission in the Palestinian territories, and no decision had been made about future staffing at the USAID mission in the U.S. Embassy in Jerusalem.
USAID is the main agency administering U.S. foreign assistance in the Palestinian territories. According to its website, the agency spent $268 million on public projects in the West Bank and Gaza as well as Palestinian private sector debt repayment in 2017, but there were significant cuts to all new funding through the end of June 2018.
Nabil Abu Rudeineh, a spokesman for Palestinian leader Mahmoud Abbas, said: “The suspension of aid to our people, which included critical sectors such as health and education, will have a negative impact on all, create a negative atmosphere, and increase instability.”
Greenblatt called Rudeineh’s statement disingenuous. “Palestinians are too smart to continue to live as victims and recipients of foreign aid. Until a political solution is found (maybe it will be our peace plan?), the PA must focus on helping Palestinians lead better lives,” he tweeted.
The Palestinian Authority is an interim self-government body set up following the 1993 Oslo peace accords.
In the Hamas-ruled Gaza Strip, Hamas spokesman Ismail Rudwan condemned the cuts, deploring what he called “politicized money.”
Diplomatic sources said Palestinian, U.S. and Israeli officials were trying to find ways to keep the money flowing to Abbas’s security forces.
“We will find a solution to these things. I won’t get into details,” Minister Yuval Steinitz told Israel Radio on Thursday.