Antonio Guterres
Antonio GuterresReuters

UN Secretary-General Antonio Guterres said on Tuesday he was "very concerned" by reports that the U.S. had cut its funding to UNRWA, the UN agency for “Palestinian refugees”, by half.

According to AFP, Guterres said he had not been informed of Washington's decision.

"I strongly hope that in the end, it will be possible for the United States to maintain the funding of UNRWA," he was quoted as having said.

"UNRWA is not a Palestinian institution but a UN institution," added the UN chief, who dubbed the agency "an important factor of stability" in the Middle East.

A State Department official said earlier on Tuesday that the United States had sent $60 million to keep UNRWA in operation but withheld a further $65 million.

"There is a need to undertake a fundamental re-examination of UNRWA, both in the way it operates and the way it is funded," the official said.

State Department spokeswoman Heather Nauert later said the U.S. “would like to see some reforms be made” in UNRWA, and stressed, “This is not aimed at punishing anyone.”

Tuesday’s announcement from the State Department came after the U.S. had frozen a $125 million grant to UNRWA earlier this month, amounting to one third of the U.S. annual aid to the organization.

The move follows recent tweets by President Donald Trump in which he questioned the wisdom of providing hundreds of millions of dollars in aid to the Palestinian Authority given their refusal to resume peace talks with Israel.

The United States is the largest single donor to UNRWA, providing approximately a fourth of the organization's budget.

For years, UNRWA has been a target for criticism in light of Hamas's activity in its educational institutions and the use of its facilities by Palestinian Arab terrorist organizations in Gaza.

UNRWA was documented storing Hamas rockets and weapons "designed to kill Israeli citizens" in its schools, a fact which the UNRWA chief admitted himself.

In addition, the organization has actively taken part in inciting anti-Semitic violence.