UNITED NATIONS (Reuters) - The Swedish ambassador to the United Nations said on Tuesday he is concerned about the Trump administration’s plans to review funding for a humanitarian agency that provides aid to Palestinian refugees.

Swedish Ambassador to the United Nations Olof Skoog speaks to reporters ahead of the Security Council consultation on the situation of North Korea's missile test, in Manhattan, New York, U.S., September 15, 2017. REUTERS/Amr Alfiky

“My concern (is) that as we talk about region stability, withdrawing funding for UNRWA would be very negative both in terms of humanitarian needs of over 5 million people but also of course it would be destabilizing for the region,” Olof Skoog said, referring to the U.N. Relief and Works Agency for Palestinian refugees.

The United States is the largest donor to UNRWA, with a pledge of nearly $370 million as of 2016, according to the organization’s website.

Last Tuesday, President Donald Trump said the United States may withhold future aid payments to Palestinians, accusing them of being unwilling to talk peace with Israel. Earlier, his U.N. Ambassador Nikki Haley said the future U.S. funding for UNRWA was under review.

A State Department official later said that no decision had been made on payment.

“We’re just trying to sort out what the exact information is on that,” Skoog said on Tuesday, adding that he has brought the subject up bilaterally with Haley.

Relations between the Palestinians and Washington soured last month after Trump announced the United States would recognize Jerusalem as Israel’s capital, generating outrage across the Arab world and concern among Washington’s Western allies.

Palestinians want East Jerusalem as the capital of a state they seek to establish in the West Bank and Gaza Strip.

Palestinian officials have said Trump’s declaration on Jerusalem meant he could not serve as an honest broker in peace negotiations with Israel that Washington has been trying to revive.

Israeli Prime Minister Benjamin Netanyahu repeated over the weekend his call for UNRWA to be dismantled.