President Donald Trump said on Thursday that the US would not renew its transfer of funds to the Palestinians until they agreed to come to the negotiating table with Israel to end the decades-long conflict.

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The Trump administration recently announced it would cease to provide any financial aid to the United Nations Relief and Works Agency (UNRWA), which the US and Israel have accused of deliberately bloating the number of bona fide Palestinian refugees.

President Donald Trump (Photo: Reuters)

“What I will tell you is I stopped massive amounts of money that we were paying to the Palestinians and the Palestinian leaders,” Trump said in a 25-minute conference call with rabbis and Jewish leaders ahead of the new year festival of Rosh Hashanah.

“The United States was paying them tremendous amounts of money. And I say, ‘You’ll get money, but we’re not paying until you make a deal. If you don’t make a deal, we’re not paying,’” he said.

Trump’s son-in-law Jared Kushner and the US Ambassador to Israel David Friedman also participated in the call.

“I don’t think it’s disrespectful at all” for US aid to be used as leverage, Trump said in response to a question posed by Harvard law professor Alan Dershowitz.

“I think it’s disrespectful when people don’t come to the table,” the president continued, according to the Jewish Insider.

Asked by Dershowitz whether the Jewish community could be optimistic about his ability to bring about a peaceful resolution to the conflict “that we pray for all the time,” Trump responded categorically.

PA President Mahmoud Abbas and Jared Kushner (Photo: AP, MCT)

“I think the answer to that is a very strong yes. I really do believe we are going to make a deal. I hope so. It would be a great thing to do,” he said.

“I am a very proud father of a Jewish daughter, Ivanka,” Trump said in his opening remarks, adding that he’s also proud Jared Kushner.

UNRWA was founded in 1949 after the first Arab-Israel war—the War of Independence—in the wake of the exodus of around 700,000 Palestinian refugees.

The nascent state of Israel absorbed Jewish refugees who were expelled or who fled from neighboring Arab countries, while other Arab states refused to grant the Palestinians citizenship.

As a result, UNRWA now looks after more than 5 million descendants of those original refugees, in Jordan, Lebanon, Syria and the Palestinian territories of the West Bank and Gaza Strip.

Israel argues that UNRWA perpetuates the Palestinian refugee problem by grossly inflating the number of genuine refugees.

Trump also spoke about the Iran nuclear deal from which he withdrew in May, which he has repeatedly described as the "worst deal."

US Ambassador to Israel David Freidman (Photo: Reuven Castro)

“They should thank us profusely for what we did. We gave them $150 billion. Even crazier sounding to me is that we gave them $1.8 billion in cash. If anybody knows what $1.8 billion in cash looks like, I’m still trying to figure it out. They took the money out of banks from three major states and they didn’t have enough, so they ended using banks from other countries to get them the money. It was the craziest deal," Trump said.

Praising the "tremendously positive impact" that his withdrawal has, Trump said "I think Israel feels a lot safer than they’ve felt in many, many years."

"I can only say from the standpoint of Israel, what I did was a great thing for Israel. And what I did was also a very good thing for world peace, because everywhere we went—especially in the Middle East—where there was a problem, Iran stood behind that problem," the president said.