The U.S. Agency for International Development (USAID) has ceased all assistance to Palestinians in the occupied West Bank and Gaza, a U.S. official said.
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 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 West Bank.
Congress’ Anti-Terrorism Clarification Act (ATCA) empowers Americans to sue foreign aid recipients in U.S. courts over alleged complicity in “acts of war”.
The Palestinian Authority declined further U.S. funding over worries about its potential legal exposure, although it denies Israeli accusations that it encourages militant 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.
USAID is the main agency administering U.S. foreign assistance in the Palestinian territories. According to it 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 President 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.”