UNRWA improves its economy amid worsening situation in Gaza

UNRWA improves its economy amid worsening situation in Gaza
Matthias Schmale, director of UNRWA operations in Gaza© UNRWA

UNRWA, UN’s agency for the Palestinian refugees, has had some success but has not quite covered its deficit after an acute economic crisis due the President Trump’s withdrawal of funding to the agency according to its director in Gaza who visited Brussels last week. At the same time tension escalated along the border between Gaza and Israel and the area was close to the eruption of a new war on Saturday (14 July), the fourth since Hamas took over control of Gaza. UNRWA provides essential services such as primary education and healthcare as well as emergency assistance to some 1.3 million Palestine refugees in the Gaza Strip. Its deficit as a whole in the beginning of 2018 was 446 million US dollar and it could hardly pay salaries to its staff.

During his visit in Brussels, the director of UNRWA operations in Gaza, Matthias Schmale, briefed the EU Council working party on Humanitarian Aid & Food Aid, as well as the EU Council working group Maghreb-Mashrek. He also met with all EU services concerned.

“Following donor conferences in Rome and New York, we have been promised 238 million dollar. Three Arab countries, Saudi Arabia, Qatar and the United Arab Emirates, have each pledged 50 million dollar,” he told The Brussels Times.

“Other countries have made advance payments or pledged to increase their annual contributions. We see it as a huge success,” he added. “We are working on adding more countries to the list of those funding UNRWA currently. Another source of revenue is contributions from individual donors”

Although the deficit remains sizeable and he is not sure that schools in Gaza will open in time after the Summer break, he expresses hope that UNRWA is on track in increasing its revenues so that it can fund its activities without generating a new deficit.


Last month EU announced an increase by up to 30 % in its external action budget for the multi-annual financial framework 2021 – 2027. The new streamlined instrument is expected to allow more flexibility, in particular through its rapid response pillar.

The Brussels Times asked the European Commission and Matthias Schmale if the new long-term budget would enable EU to fund urgent infrastructure projects in Gaza concerning electricity production, water and waste management, to improve the standard of living, de-escalate tension and reduce the risk of war.

An EU spokesperson replied that it is too early at this stage to prejudge country allocations. In fact, only allocations by geographical and other programmes have been made. “In the future assistance to Palestine will be programmed in a tailor-made and specific approach.”

EU has already invested in infrastructure projects in Gaza exceeding € 147 million, including water, energy and waste, according to the spokesperson. She also referred to a plan by Nickolay Mladenov, UN Special Coordinator for the Middle East Peace Process, to accelerate project implementation in the Gaza Strip. “We are fully supportive of his ongoing efforts in this regard.”

“EU today is our biggest donor with € 82 million per year and a stable partner when it comes to funding our core activities such as health and education,” Matthias Schmale replied. “We don’t see any indication that the new instrument will change that.”

That said, UNRWA is involved in talks with EU on increased funding to improve living conditions in Gaza. Among others, in March EU co-hosted a conference where €456 million was mobilised for the construction of a desalination plant to provided clean drinking water in Gaza. EU pledged €70 million for the desalination plant plus €7.1 million for management costs.

We are responsible for providing core services to the Palestinian refugees but aware of that investments in infrastructure are necessary to avoid a collapse of Gaza,” Schmale said.


Does UNRWA receive all the goods it needs for running its services in Gaza despite the on-going blockade by Israel against Hamas?

“Yes and no,” he replied. “We have a pragmatic and functioning relationship with the Israeli authorities. There is no problem to import food to the 70 % of the population in Gaza we are caring for. But there is a problem with dual-use goods which can be used for both civilian and military purposes. As a result there are at times long delays with construction material.”

He mentioned that only a handful of his management staff has permits to travel outside Gaza and, even worse, that only half of all applications for medical treatment at hospitals outside Gaza are approved.

The Brussels Times contacted Cogat, the Israeli authority for “Coordination of Government Activities in the Territories” for a comment. Its website highlights that Israeli volunteers arrive at the Erez Crossing in order to transport Palestinian patients from the Gaza Strip to hospitals in Israel where they receive medical treatment.​​​​

“The Gaza Strip is ruled by the Hamas terror organization, which exploits civilian measures advanced by the State of Israel for the purposes of terror,” a spokesperson for Cogat replied.

“In light of this, every request to enter or cross through Israeli territory is considered by all relevant security authorities, and the decisions to approve such requests are made in accordance with the criteria established by the political echelon.”

Cogat denied that there has been a reduction in the number of permits for medical needs that have been approved. “In the first half of 2018, there was an increase in the number of Gaza Strip residents crossing into Israel for medical needs via Erez Crossing, this in comparison to the second half of 2017.”

As regards the number of travel permits for UNRWA staff, Cogat replied that the claim cannot be checked without names or other identifying information.

Preventing a new war

In the beginning of last week, Israel closed the Kerem Shalom crossing, the only crossing for goods between Gaza and Israel, in response to the continued launching of incendiary kites and balloons from the Strip that have caused wild fires on the Israeli side. Hamas reacted with rocket fire and Israel retaliated with air strikes against Hamas bases.  

After intensive efforts by Egypt and UN’s Special Coordinator, the two sides agreed to a cease-fire. But the situation can still easily spiral out of control as the humanitarian situation in Gaza is dire and the basic political issues remain unsolved. Israeli security and intelligence agencies are constantly warning against the risk of a new war if these issues are not addressed.

Christopher Gunness, UNRWA´s spokesperson in Gaza calls for a full lifting of the blockade. “The new measures will likely lead to increased demand for UNRWA services at a time of unprecedented financial crisis and when Gaza is in the midst of a deepening and now protracted humanitarian crisis.”

“These additional restrictions further penalize the entire population in Gaza without regard to individual responsibility,” he stated. 

Asked whether he also discussed political issues in Brussels, Schmale replied that, “We do think that the blockade is the main cause of the situation”.

“We don’t want to wait another 70 years for a political solution,” he concluded. “We are the result of a political failure of the international community to implement a just solution for the question of Palestine and Palestine refugees, and this has to be urgently addressed,” he said.

But there is no agreement on what a just solution means. What is certain is that the civilian population in Gaza has become the victim and hostage of the on-going conflict between Hamas and Israel. A new war would risk destroying what has been rebuilt since the previous war in 2014.

Hamas won elections in Gaza in 2006 on promises of fighting corruption. Instead it started a terror campaign against Israel, instilling false hopes among the refugees. In 2007 it took full control of Gaza after defeating and expelling its Palestinian adversaries from Fatah. Since then no elections have been held in Gaza and the West Bank. Both Israel and EU consider Hamas a terrorist organisation.

M. Apelblat
The Brussels Times

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