Denmark, Sweden suspend Palestinian development aid amid Gaza war

Denmark and Sweden said Tuesday they were suspending Palestinian development aid but maintaining humanitarian assistance following Hamas' surprise attack on Israel on Saturday.

The announcements came a day after the European Commission launched a review of its development aid to the Palestinians.

The government in Copenhagen said in a statement it "has decided to put Danish development assistance to Palestine on hold".

"A thorough review will be conducted to ensure that no Danish funding is misused to indirectly support terrorist organisations that attack Israel," it said.

The review will be conducted "in close dialogue with Denmark's partners in the EU and the Nordic countries," it said.

For 2023, Denmark had earmarked humanitarian and development aid totalling 235.5 million kroner ($33.5 million) for the Palestinian territories.

Around 72 million kroner of development aid has yet to be disbursed.

"It is this assistance that is now being put on hold," the statement said.

Sweden also said it was suspending development aid but did not provide any immediate details on the amount.

Austria and Germany have also announced that they were suspending development aid, with Berlin saying it would be "completely wrong" to cease essential humanitarian aid for the civilian population.

Norway, however, stressed that the international community "should continue to provide financial aid to the Palestinian people and institutions", in a statement from Oslo's Foreign Minister Anniken Huitfeldt on Wednesday.

"As chair of the international donor group (to the Palestinians) AHLC, Norway encourages the international community to continue its financial assistance to the Palestinian people," Huitfeldt told Reuters.

Huitfeldt emphasised that "the situation in the area will only deteriorate if aid is suspended" and that "humanitarian assistance to the people of Gaza should be a key priority".

Several EU countries have also come out in favour of maintaining aid to the Palestinians, forcing the EU to backtrack on an announcement to suspend aid earlier this week. Neighbourhood commissioner Oliver Varhelyi on Monday said that the 27-nation bloc was immediately suspending "all payments" to the Palestinians.

Israel has been launching its heaviest strikes on Gaza in 75 years, destroying key infrastructure in the impoverished enclave home to more than 2 million people, while under a heavy blockade since 2007.

Israeli strikes in Gaza have killed at least 1,055 people as of Wednesday, according to the Palestinian Health Ministry, and have injured thousands more, while Hamas' cross-border assault has killed at least 1,200 Israelis.

(Reuters, AFP and The New Arab Staff)