Tens of thousands of Palestinians are no longer getting food aid or basic health services from America, US-funded infrastructure projects have been halted, and an innovative peace-building program in Jerusalem is scaling back its activities.
The US government's development agency, USAID, has provided more than $5.5 billion to the Palestinians since 1994 for infrastructure, health, education, governance and humanitarian aid programs, all intended to underpin the eventual creation of an independent state.
Much of that aid is channeled through international NGOs, which were abruptly informed of the cuts last summer and have been scrambling to keep their programs alive.
President Donald Trump says the USAID cuts are aimed at pressuring the Palestinians to return to peace talks, but Palestinian officials say the move has further poisoned relations after the US recognised Jerusalem as Israel's capital last year. The aid groups, many of which have little or no connection to the Palestinian Authority, say the cuts hurt the most vulnerable Palestinians and those most committed to peace with Israel.
"If you want to maintain the idea of the peace process, you have to maintain the people who would be part of the peace process," said Lana Abu Hijleh, the local director for Global Communities, an international NGO active in the Palestinian territories since 1995.
Before the aid cuts were announced, it provided food aid branded as a gift from the American people to more than 180,000 Palestinians in the Israeli-occupied West Bank and Gaza on behalf of the World Food Program. USAID had planned to contribute USD 19 million a year for the next five years to continue the project but pulled out in August.
Global Communities can now only provide aid to 90,000 people through March, and Abu Hijleh had to lay off around 30 staff, including in Gaza, where unemployment exceeds 50 per cent.
"It really hurts, because you're talking about the most basic level of assistance," she said. The average family receives a monthly voucher worth around USD 130.
Sadeqa Nasser, a woman living in Gaza's Jebaliya refugee camp, used her voucher to support her disabled husband, their six children and four grandchildren.
She says her sons each bring in less than $5 a day from odd jobs. "They cannot afford to buy food for their families, so I help them out," she said.
Since the aid was cut off, she's been able to qualify for welfare payments from the Palestinian Authority, which itself relies heavily on foreign aid. "Without it we would go hungry," she said.
Funding has also been cut for a five-year, USD 50 million program run by a coalition of NGOs to provide health services, including clinical breast cancer treatment for some 16,000 women and treatment for some 700 children suffering from chronic diseases.
Infrastructure projects, including desperately needed water treatment facilities in the blockaded Gaza Strip, have also been put on hold.
Anera, which has carried out development projects in the Middle East for more than 50 years, said it was forced to halt five infrastructure projects in the West Bank and Gaza before completion and cancel three more in Gaza that were pending funding approval. It says the projects would have benefited more than 100,000 people.
The NGOs are reaching out to other donors, but USAID is one of the biggest sources of funding for a global aid community overwhelmed by conflicts in Syria, Yemen and elsewhere.
The Trump administration has also cut off funding for peace-building initiatives involving Palestinians even residents of east Jerusalem, which Israel considers to be part of its capital. The Palestinians want east Jerusalem, which Israel captured in the 1967 war and annexed in a move not recognized internationally, to be the capital of their future state.
Kids4Peace, a group founded by Israeli and Palestinian families in Jerusalem in 2002, brings Jewish, Christian and Muslim teenagers together for seminars and summer camps where they can share their experiences and learn more about one another.
The group's organizers acknowledge the longstanding criticism of such initiatives that campfires and singalongs won't bring peace to the Middle East, especially after a decade of diplomatic paralysis and little hope for resuming meaningful negotiations.
But they say that with a USD 1.5 million USAID grant in 2016 they tripled the number of annual participants to around 70 and revamped programs.
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