The European Commission announced on Monday that it would review its development aid of 691 million euros ($729 million) for Palestinians and immediately halt payments in response to Hamas' attack on Israel.
Germany and Austria also suspended their bilateral development aid to Palestinians on the same day, while Italy stated that suspending aid was not on the table for discussion. Europe plays a significant role in providing aid to the Israeli-occupied Palestinian territories, where approximately 2.1 million people, including 1 million children, require humanitarian assistance.
It remains uncertain if these aid suspensions also apply to humanitarian assistance. The European Commission did not respond immediately to requests for clarification. Oliver Varhelyi, the European Commissioner for Neighbourhood and Enlargement, described the scale of violence against Israel as a turning point and emphasized that "business as usual" was no longer an option.
Spain disagreed with the suspension of European Commission aid for Palestinians and expressed its concerns about the decision being made without consulting member states' foreign ministers. Spain's foreign office called for an urgent discussion during a special EU meeting on Tuesday.
Hamas' recent actions, including the killing of Israelis and abductions, led to Israel's heaviest bombardment of Gaza, resulting in over 400 casualties. Varhelyi announced the postponement of all new budget proposals for Palestinian aid, emphasizing the need to address the foundations of peace, tolerance, and co-existence.
European Union foreign ministers will hold an emergency meeting on Tuesday to discuss the situation, including a review of development aid. The total EU assistance allocated for the Palestinian people in the 2022 budget was 296 million euros. Notably, the EU Commission, Germany, and Austria did not differentiate between Gaza, governed by Hamas, and the larger West Bank, led by the Western-backed Palestinian Authority under President Mahmoud Abbas.
Austria suspended approximately 19 million euros ($20 million) in development aid for select projects, while Germany's Development Minister, Svenja Schulze, announced the re-examination of engagement with the Palestinian territories, temporarily halting payments for bilateral aid projects. Germany's development ministry had earmarked 250 million euros for bilateral projects in the Palestinian territories for this and the next year.
However, the exact disbursement for this year was not disclosed. Despite emphasizing solidarity with Israel, some politicians in Germany raised concerns about suspending aid, arguing that not all Palestinians should be held responsible for Hamas' actions.
The Green-run foreign ministry in Germany stated its intention to continue disbursing the 73 million euros allocated for Palestinians through international organizations and the United Nations, which were separate from the development ministry funds.
Italy did not consider suspending development aid, and the UK expressed its intent to continue providing aid to Palestinian refugees through the United Nations, with no plans to change its approach.