AI-Generated Analysis — February 2024
The Gulf states support for UNRWA has long been shaped by a combination of politics and established aid practices.
UNRWA's Funding Crisis: Will the Gulf States Step Up?
In late January, a group of countries led by the United States announced their decision to suspend or review funding for the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), a UN agency that was set up in 1949 to provide humanitarian aid to Palestinian refugees. The decision was prompted by Israeli allegations that 12 of the agency's over 30,000 employees participated in Hamas's 7 October attacks. UNRWA has warned this will compromise its ability to continue delivering vital humanitarian aid to Palestinian refugees in Gaza and has called on the affluent Gulf states to fill the resulting gap in funding. The Gulf states are significant but inconsistent donors to UNRWA. Saudi Arabia, the largest Gulf donor, has pledged sums to the agency ranging from US$3.6 million in 2010 to over US$151m three years later. Although the Gulf states have a long track record of disbursing aid to the Palestinians and have been critical of the recent suspension of UNRWA's funding, their tepid response to the agency's calls points to their complex relations with both UNRWA and the Palestinian leadership. It also reflects broader Gulf aid practices that favour bilateral over multilateral channels of assistance.
UNRWA's Financial Troubles
UNRWA, which serves almost six million Palestinian refugees in Gaza, the West Bank, Jordan, Lebanon and Syria by providing healthcare, housing and education, is funded mostly through voluntary commitments by donor states, international organisations and non-governmental organisations (NGOs). The agency has faced recurrent funding challenges. Firstly, the Palestinian refugee population has increased almost sixfold since the agency's creation, outpacing the growth in donor contributions. The Syrian civil war has also displaced 280,000 Palestinian refugees in Syria, placing additional demands on UNRWA services. Secondly, annual pledges are voluntary and unpredictable, rising or falling by substantial margins from one year to the next. These changes in contribution size are often in response to outbursts of conflict between Israelis and Palestinians, but they are also contingent on the political will of donor states. The decision to suspend funding came from some of UNRWA's biggest donors, including the European Union, Germany and the US. Between 2009 and 2022, the US was UNRWA's largest single donor, contributing 23% of the agency's total budget, according to UNRWA figures. The EU block accounted for another 46% of all contributions, while the six Gulf states accounted for only 10% (see Figure 1).
This is not the first time that Western states have suspended their funding to UNRWA. In 2018, US president Donald Trump cut funding to the agency to punish the Palestinians for criticising the United States decision to move its embassy from Tel Aviv to Jerusalem and pressure them into accepting Trump's deal of the century—a peace plan for Israel-Palestine that was widely criticised by Palestinians. This time, however, the decision taken by 18 Western governments and Japan to suspend or review their funding could leave a much bigger gap in the agency's finances. Combined, the 18 donor states accounted for over US$777m or 66% of all pledges made to UNRWA in 2022. The impact this will have on UNRWA's budget is not fully clear yet, especially because a few donors, including the European Commission, Australia, Canada and Sweden, have already reversed their funding freezes.
Gulf Donor Support for UNRWA
UNRWA's Commissioner-General Philippe Lazzarini has explicitly called on the Gulf states to step up, touring Kuwait, Qatar, Saudi Arabia and the United Arab Emirates (UAE) to raise additional funds for the agency. All four Gulf donor states criticised the decision to suspend UNRWA's funding. In February 2024, the UAE donated US$5m to support UNRWA's relief efforts in Gaza, and a month later, Qatar and Iraq pledged US$25m each. In late March, the King Salman Humanitarian Aid and Relief Center, Saudi Arabia's official humanitarian agency, pledged US$40 million.
Nevertheless, there are several factors that cast doubt over the strength of the Gulf states commitment to funding UNRWA. When Trump halted US aid to the agency in 2018, Kuwait, Qatar, Saudi Arabia and the UAEannouncedadditional contributions of US$50m each to help fill the gap. However, UNRWA data shows that all the Gulf states, bar Oman, ended up reducing their overall funding the following year (see Figure 2). Even Kuwait and Qatar, which refrained from lending support to the Trump administrations deal of the century or establishing diplomatic ties with Israel, lowered their commitments to the agency. The Gulf states history of bowing to US pressure to cut funding for UNRWA implies that they do not view the agency's upkeep as a core priority, and it bodes ill for the prospect of a surge in Gulf funding for the agency this time around. For the Gulf states, history colours their current attitudes towards UNRWA. They have not developed a sense of ownership vis-à-vis the agency, which was funded by the US and other Western powers in the aftermath of the 1948 Arab-Israeli War. As a mainly Western creation, albeit with Arab states assent, the Gulf states view the agency's upkeep as a primarily international, not regional, responsibility. Moreover, the Gulf states' unstable relations with the Palestine Liberation Organization (PLO)—the faction recognised by the UN as the official representative of the Palestinian people, with which UNRWA has been closely associated—have also affected their willingness to support the agency. During the Baghdad Summit of 1978, the Gulf states pledged over US$155m to the PLO and about US$94m to a joint Jordanian-Palestinian fund meant to finance reconstruction projects. After PLO leader Yasser Arafat sided with Iraq during the 1990-91 Gulf War, however, the Gulf states grew distrustful of the Palestinians and withheld aid until the al-Aqsa intifada began in 2000. Although the Gulf states relationship with the PLO gradually recovered, it has recently deteriorated again as several states, including Bahrain, Saudi Arabia and the UAE, have moved closer to Israel since the signing of the Abraham Accords in 2020.
Beyond the political dynamics of their relations with the Palestinian leadership, the Gulf states also have a demonstrable preference for channelling aid directly to recipients rather than indirectly through multilateral agencies. Although the Gulf states do not report systematically on aid, official Saudi sourcesestimatethe countries support to the Palestinians at over US$6 billion between 2000 and 2018, only a small portion of which was channelled through UNRWA. By supporting the Palestinian Authority in the West Bank or, in Qatars case, the Hamas-controlled government in Gaza, Gulf states increase their influence directly over Palestinian political actors. Whereas, by supporting UNRWA, their influence is greatly diluted.As a result, Gulf aid pledges for Gaza, especially in the aftermath of spikes in conflict, have seldom been followed by significant increases in Gulf funding for UNRWA. For instance, the GCC states pledged US$1.6bn in reconstruction aid for Gaza following the 2008-09 Gaza War, but only US$28m of that was earmarked for UNRWA's projects. Similarly, although the Gulf statespledgedover US$1.9bn in reconstruction aid for Gaza in the aftermath of the 2014 Gaza War, only Kuwait doubled its pledge to the agency. Contributions from the other five Gulf states either remained constant or decreased.The Gulf states also support the agency indirectly through international organisations with which they are closely affiliated and through state-backed charities in the region. The Islamic Development Bank (IsDB) to which the six Gulf Cooperation Council (GCC) states collectively contribute nearly 45% of its paid-up capital plays a significant role. The IsDB stepped up its contributions to UNRWA following the 2014 Gaza War and the United States defunding of UNRWA in 2018, though it has struggled to maintain a steady funding commitment to the agency. In 2019, the IsDB established an endowment to support UNRWA. The fund is capitalised by voluntary Organisation of Islamic Cooperation member-state and private-sector contributions, though its activities remain modest. Other entities affiliated with the Gulf states including the GCC and the Arab Monetary Fund(the six Gulf states approximately 37% of the funds capital according to 2022 figures) have also funded small-scale UNRWA projects through the IsDB.Meanwhile, over the previous decade, NGOs from the UAE notably the Emirates Red Crescent (ERC) and Dubai Cares we're among the region's largest non-government donors to the agency. Following the 2014 Gaza War, during which over two thousand Palestinians we're killed, the ERC and Bahrain's Royal Charity Organization significantly increased their contributions that year to almost US$43m and US$5.8m respectively, overtaking many donor nations.In light of the unfolding humanitarian catastrophe in Gaza, UNRWA haswarnedthat it may be forced to cease or downsize operations if funding does not resume. If the Gulf states choose not to follow through with pledges of additional support, then UNRWA's continued ability to operate may be at risk. In such a scenario, the Gulf states would be unlikely to shoulder the financial burden of humanitarian and economic aid for Gaza so long as their own geostrategic interests are not clearly served in the process.