The UNRWA Commissioner-General, Pierre Krahenbuhl, said in a statement on Wednesday that the organisation was faced with “the most dramatic financial crisis in its history.”
He called donors and host countries to create “new funding alliances”, saying a global fundraising campaign would be launched in the coming days.
The U.S. government, on Tuesday, earmarked 60 million dollars for the agency for 2018, saying it would withhold 65 million dollars.
The U.S. State Department Spokeswoman, Heather Nauert, said “the fund was are Frozen for future consideration.”
The U.S. was the largest single donor to UNRWA, contributing more than 350 million dollars to the agency in 2017.
Krahenbuhl added that the U.S. move would stoke “further radicalisation” throughout the Middle East.
UNRWA supports some five million Palestinian in Jordan, Syria, Lebanon and the Palestinian Territories.
During the 1948 Arab-Israeli conflict, more than 700,000 Palestinians were displaced or forced to flee. UNRWA also supports their descendants.