Palestinian men walk in front a mural painted on a wall of the headquarters of the United Nations Relief and Works Agency (UNRWA) in Gaza City AFP

US President Donald Trump had already pledged to cut almost all humanitarian aid to the Palestinians amid a dispute with president Mahmud Abbas

The Palestinian government will refuse all US government aid for fear of lawsuits, officials said Tuesday, throwing the future of security coordination and projects already under way into doubt.

Senior official Saeb Erekat confirmed US media reports that the Palestinians had demanded all funding stop at the end of the January for fear they would expose themselves to costly law suits under the US Anti Terrorism Clarification Act (ATCA) which is about to come into force.

"The government sent an official letter to the US administration requesting it stop all aid to the Palestinian Authority, including assistance to the Palestinian security services," Erekat told AFP.

He said the main reason for the move was the ATCA legislation, under which the financial aid provided by the US could be used as a means "for various groups to file lawsuits against the Palestinian Authority."

US President Donald Trump had already pledged to cut almost all humanitarian aid to the Palestinians amid a dispute with president Mahmud Abbas, but projects were being phased out gradually.

The planned expansion of a school near Bethlehem will now not be completed, while infrastructure projects in Jericho and other towns will also stop.

The US also provides roughly $50 million in annual support for Palestinian security services, including to support security coordination with Israel that Israeli officials say is crucial for maintaining calm in the West Bank.

This funding was not cut off by the US government despite humanitarian aid cuts but will now be stopped.

The ATCA legislation passed by Congress last year provides for any government that receives funding to be subject to US counterterrorism laws.

The Palestinian Authority faces potential lawsuits from families of American victims of past Palestinian attacks.

The US consulate in Jerusalem confirmed Tuesday it was "working through" the potential impact of ATCA and had "taken steps to wind down certain projects and programmes in the West Bank and Gaza."

Erekat played down the ending of US funding saying it would "not impact on the role of the security services."

However, a senior Palestinian security official told AFP the impact could be significant.

The search is on for new sources of funding in Europe and elsewhere, the official said, speaking on condition of anonymity.

A handful of US contractors working to support the security services have already left the Palestinian territories ahead of the end of the month, he added.



