The US cut in funding for the UN agency that helps Palestinian refugees will put the stability and security of the region at risk, Arab League Secretary General Ahmed Aboul Gheit said on Thursday.
The United States, by far the largest contributor to United Nations Relief and Works Agency (UNRWA), announced on January 16 that Washington would withhold $65 million of $125 million it had planned for the agency this year. UNRWA is funded almost entirely by voluntary contributions from UN member states.
The US President Donald Trump has questioned the value of such funding, and the State Department said the agency needed to make unspecified reforms.
"It is no secret that this trend poses a threat to the refugee issue ... as well as the negative consequences that will not only affect the receiving countries of refugees, but also the stability and security of the region," Mr Aboul Gheit said at an Arab League meeting in Cairo.
The meeting was addressed by the UNRWA chief Pierre Krahenbuhl, who described the US funding cut as "the most severe crisis" in the agency's history and appealed to Arab nations to help make up the shortfall.
The US decision adds to Palestinian anger at Washington following its decision in December to recognise Jerusalem as Israel's capital despite the final status of the city being one of the key points to be decided in Israeli-Palestinian peace talks.
The UNRWA serves some 5 million Palestinian refugees and their descendants. More than half of the two million people in Gaza are dependent on support from UNRWA and other humanitarian agencies. Palestinians say the funding decision could deepen hardship in the Gaza Strip, where the unemployment rate is 46 per cent.
UNRWA was established by the UN General Assembly in 1949 after hundreds of thousands of Palestinians fled or were expelled from their homes in the 1948 war that followed Israel’s creation.