Seham al-Laham is expecting their first child.

What should be a happy occasion, however, was overshadowed by an anxious wait for the United Nations Agency for Palestinian Refugees (UNRWA) to cover their childbirth expenses at a government-run hospital in Amman, Jordan.

The 20-year-old Palestinian refugee has diligently managed to get all of her appointments in the medical care centers in the Jabal el-Hussein camp where she lives. “However, the clinics run by UNRWA faced a shortage of medicine and laboratory equipment,” said al-Laham.

“We have heard of the financial problems UNRWA is facing and I was concerned about my delivery and the medical benefits for me and my newborn,” she told Al Jazeera.

UNRWA provides life-saving services, including basic basic medical care, in 25 clinics in refugee camps in Jordan.

But an unprecedented financial crisis has put UNRWA’s critical health services at risk – and even US President Joe Biden’s recent pledge to restore aid to Palestinians will not solve the problem in the long run, experts say.

The US has long been the agency’s largest single donor. They contribute about 30 percent (nearly $ 365 million) to UNRWA’s annual budget, making them particularly vulnerable to the political whims of various US governments.

In 2018, the Trump administration stopped funding UNRWA and plunged the organization into financial instability. Washington attributed the cut to the need for unspecified reforms as it pushed the Palestinians to renew peace talks with Israel.

“The biggest challenge facing the institution is that it is financially unstable, unless there is an international mandate that provides long-term funding,” said Tareq Baconi, senior analyst for the International Crisis Group for Palestine and Israel.

“The Trump administration has shown that this is not only politically punishable, but also that the organization has become overly dependent on the US.”

‘Very difficult’

UNRWA needs more than US $ 1 billion annually to administer its regular, emergency and life saving services for approximately 5.7 million Palestinian refugees in the occupied Palestinian territories of Jordan, Syria and Lebanon.

While there have been some positive signs that Biden’s administration may resume funding in Washington, which it halted in 2018, that won’t be enough to meet the agency’s $ 200 million budget deficit for 2021.

On February 2, U.S. State Department spokesman Ned Price said the Trump administration’s decision to cut aid to Palestinians was not intuitive, adding that the new leadership would restore financial aid.

“The suspension of aid to the Palestinian people has neither led to political progress nor secured concessions from the Palestinian leadership. It only harmed innocent Palestinians, “Price said during a press conference.

The administration of US President Joe Biden said this month that it will restore aid to the Palestinians [File: Tom Brenner/Reuters]“The US will reinvigorate our humanitarian leadership and work to motivate the international community to honor its humanitarian commitments, including to the Palestinian people. We are working on this very quickly to restore it, ”he added.

UNRWA spokeswoman Tamara al-Rifai welcomed the announcement, but the agency’s financial situation will be “very difficult” this year. “We expect a financial crisis to emerge from March this year, and on a larger scale, the expected deficit for this year could lead to the agency’s financial collapse,” she said.

“We are considering the prospect of the reintegration of the new US administration and therefore expect a slightly better income than in 2020, but that slight increase in income will not cover the agency’s enormous liabilities.”

Refugee problem

UNRWA was founded in 1949 after the Nakba – or catastrophe – that resulted in the exodus of approximately 700,000 Palestinians. Today UNRWA provides education, health and social services to Palestinian refugees.

Palestinian officials believe that the US decision to cut funding for UNRWA was an attempt to forestall future negotiations on the final status of the right of return for Palestinian refugees. Along with Jerusalem and the borders of a future state, this is one of the main points of the negotiations.

The very notion that Palestinians are refugees sparked the White House’s diplomatic onslaught, former Brookings Institution expert Hady Amr wrote in 2018; in particular the ability of stateless persons to pass on their refugee status to future generations under international law.

The Israeli Prime Minister Benjamin Netanyahu has long pushed for the abolition of UNRWA and advocated that its responsibility be transferred to the UN Refugee Agency (UNHCR).

“There is a chronic challenge the organization faces in terms of its viability and the more the political reality on the Palestinian issue is marginalized and challenged, the more difficult it is for UNRWA to do its job,” said Baconi.

Uncertain future

Though badly hurt by years of budget cuts, the organization has remained intact despite the best efforts of key Trump administration officials such as former UN Ambassador Nikki Haley and Jared Kushner, Trump’s son-in-law and senior adviser.

In 2018, Haley claimed UNRWA had exaggerated the number of Palestinian refugees and said the agency needed reforms. “You see the fact that there are infinitely many refugees who continue to receive aid, but more importantly, the Palestinians keep beating America,” she said at the time.

Kushner’s Family Foundation has made donations to Israeli settlements and has a longstanding relationship with Netanyahu. Foreign Policy reported in 2018 that in order to sabotage the work of UNRWA, Kushner tried to pressure Jordan to deprive two million Palestinians living there of their refugee status.

The United Arab Emirates, which signed a US-brokered normalization agreement with Israel last year, drastically reduced their funding for UNRWA – from $ 51.8 million in 2019 to $ 1 million in 2020. Israel’s Channel 12 reported that Bahrain had also cut aid to the agency, but no exact figures were available.

UNRWA provides assistance and services to around 5.7 million Palestinian refugees in the Occupied Palestinian Territories, Jordan, Syria and Lebanon [File: Mohamad Torokman/Reuters]A government official from the Emirates told Reuters this week that the UAE has no plans to restore funding until steps are taken to manage it more effectively. “We are in dialogue with the leadership of UNRWA on how the effectiveness of the aid can be improved,” said the Minister of State for International Cooperation, Reem al-Hashimy.

“The question is whether the Gulf will try to dismantle UNRWA and whether the US will go along with it [with it]”Said Zaha Hassan, a human rights attorney and senior legal advisor to the Palestinian negotiating team during Palestine’s application for UN membership in 2010-12.

Whether Washington will actually resume aid to Palestinians remains to be seen, Hassan told Al Jazeera.

“The Biden administration has not resumed aid to UNRWA and has not mentioned the agency by name. The money can go to other international NGOs or UNHCR. “