Trump's threat to cut Palestinian aid worries many in Israel

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"They don't even want to negotiate a long overdue peace treaty with Israel. with the Palestinians no longer willing to talk peace, why should we make any of these massive future payments to them?"

Trump's actions are likely to cast that further in doubt.

'As we've said all along, the vice president is going to the Middle East in January, ' said Pence spokeswoman Alyssa Farah.

Tensions between the USA and Palestinians reached a breaking point after Trump's December 6 recognition of the Israeli capital, with the Palestinian leadership declaring that it would no longer accept Washington as a peace broker.

Palestinian Authority President Mahmoud Abbas has since said that he is not willing to return to talks as long as the United States is the sole mediator.

"The United States has proven to be a dishonest mediator in the peace process", said Palestinian President Mahmoud Abbas, who has said he will not accept any USA peace plan for the Middle East.

'President Trump has sabotaged our search for peace, freedom and justice, ' she said.

The move follows Trump's controversial decision in December to recognise Jerusalem as Israel's capital, provoking unrest and triggering clashes in the Gaza Strip.

Mr Trump drew praise from a cabinet minister in Israeli Prime Minister Benjamin Netanyahu's right-wing government but a warning from a former Israeli peace negotiator of the dangers in cutting off financial assistance to the Palestinians.

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The U.S. Ambassador to the U.N., Nikki Haley, said in a speech earlier on Tuesday that the U.S. would stop funding UNRWA unless the Palestinians "agree to come back to the negotiation table".

"Haley responded to a question regarding whether the U.S. would continue to fund the agency in light of the Palestinians' threat to "unleash all the weapons we have in the UN", by saying, "[President Trump] doesn't want to give any additional funding, or stop funding, until the Palestinians agree to come back to the negotiation table, and what we saw with the [UN Jerusalem] resolution was not helpful to the situation". "Now he dares to blame the Palestinians for the consequences of his own irresponsible actions!"

"Jerusalem is the eternal capital of the state of Palestine and it is not for sale for gold or billions", Abbas spokesman Nabil Abu Rudeineh told AFP.

The Palestinians rely heavily on global aid, with many analysts, including Israelis, saying such assistance helps maintain stability in a volatile region.

In 2016, nearly $370m went to Unrwa, an agency that provides assistance to some five million Palestinian refugees across the Middle East.

In December, Ms Haley sent a "Save the Date" invitation to the 64 countries who did not lend their backing to the resolution to thank them for their "friendship to the United States".

"We hope that this vote serves as a reminder for the worldwide community that the Israeli government, with the full support of the USA administration, is not interested in a just and lasting peace". But the Israeli government would not want to see the collapse of the Palestinian Authority, he said.

Trump has said his decision merely recognized the reality that Jerusalem already serves as Israel's capital and wasn't meant to prejudge the final borders of the city.

Haley made her remarks against the backdrop of an announcement in December that the United States recognizes Jerusalem as Israel's capital and plans to move its embassy there, which was met by a United Nations resolution condemning the move. Trump's Mideast peace team had held meetings with Israeli, Palestinian and Arab leaders for almost a year ahead of an expected peace proposal.

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