Trump ’s move is the latest provocative move that could upturn years of careful diplomacy after his recognition of Jerusalem as the capital of Israel.
Relations between Trump’s White House and the Palestinians were already tense after the US president’s Jerusalem’s pronouncement in December.
The December 6 announcement concerning the disputed city led Palestinian president Mahmud Abbas to say the United States could no longer play any role in the Middle East peace process.
Trump’s threat in a tweet on Tuesday to try to force the Palestinians into negotiations caused further outrage, though Israeli ministers lauded it.
The Palestinians rely heavily on international aid, with many analysts, including Israelis, saying such assistance helps maintain stability in a volatile region. The European Union is also a major contributor.
“We pay the Palestinians HUNDRED OF MILLIONS OF DOLLARS a year and get no appreciation or respect,” Trump tweeted.
“They don’t even want to negotiate a long overdue peace treaty with Israel. We have taken Jerusalem, the toughest part of the negotiation, off the table, but Israel, for that, would have had to pay more.
“But with the Palestinians no longer willing to talk peace, why should we make any of these massive future payments to them?”
It was not immediately clear whether Trump was threatening all of the budget, worth $319 million in 2016, according to US government figures.
The United States has long provided the Palestinian Authority with much-needed budgetary support and security assistance, as well as an additional $304 million for UN programmes in the West Bank and Gaza.
UNRWA, the UN agency for Palestinian refugees, said so far it had not been informed by the United States of any changes in financing.
Israel receives more than $3 billion in military aid per year from Washington.
Abbas’s spokesman said they were not against negotiations, but that talks should be “based on international laws and resolutions that have recognised an independent Palestinian state with east Jerusalem as its capital”.
“Jerusalem is the eternal capital of the state of Palestine and it is not for sale for gold or billions,” Nabil Abu Rudeina told AFP.
Senior Palestinian official Hanan Ashrawi said in a statement that “we will not be blackmailed”.
“President Trump has sabotaged our search for peace, freedom and justice,” she said.
Read more: AFP