The European Commission announced on Monday that it has suspended all payments connected to development aid for the Palestinian authorities. This step comes as Brussels reviews the EU’s assistance amidst the weekend attack launched by Hamas, the Islamist movement that controls Gaza, and as authorities reassess how funds are allocated in light of recent events.
Neighborhood Commissioner Oliver Varhelyi confirmed in a social media post that the bloc would immediately freeze planned disbursements and initiate a thorough review of ongoing projects. The move mirrors actions taken by Austria and follows Germany’s stated intention to reevaluate its cooperation commitments in light of the crisis.
According to Varhelyi, all new budget proposals, including the 2023 budget, are being postponed until further notice. He noted that the total aid implicated amounts to nearly 700 million euros and that a comprehensive assessment of the entire portfolio would be conducted to ensure alignment with security and humanitarian considerations.
He emphasized that the scale of the violence and brutality of the attack on Israel marks a turning point for EU policy. Brussels has signaled that it cannot maintain the status quo in the current climate, underscoring a need for recalibration of how aid is delivered and overseen.
In his remarks, the commissioner also lamented that hatred, violence, and the glorification of terrorism have poisoned minds in various quarters and called for addressing the underlying roots of conflict to foster peace, tolerance, and coexistence in the Middle East. He stressed the urgency of action, reiterating the need for decisive steps in response to the Islamist assault that resulted in more than 700 Israeli deaths, most of them civilians.
Last year, Varhelyi was involved in a broader debate around tying more than 200 million euros in aid to the Palestinian Authority to reforms within the education sector, a move tied to concerns about how school curricula may influence attitudes toward Israel. The issue sparked extensive discussion and scrutiny over policy conditions on aid disbursement.
Spokesperson Ana Pisonero reiterated from Brussels that officials are weighing how the latest events could affect both current and future development support. She affirmed that the EU’s measures include safeguards designed to ensure that aid is not diverted to non-peaceful ends, underscoring that the EU does not fund Hamas, which administers the Gaza Strip, either directly or indirectly.
EU financial commitments to Palestine continue to be large-scale, with multi-year allocations totaling more than a billion euros in recent years. The broader European assistance package has aimed to support public spending, healthcare access, and water services among Palestinians. In 2022 alone, humanitarian aid and support for Palestinian refugees reached hundreds of millions, and EU cooperation funds have remained substantial as part of a broader, ongoing humanitarian and development effort. The current pause and review are part of a careful risk assessment of how best to balance security concerns with humanitarian needs, while maintaining commitments to vulnerable populations and the longer-term goals of stability in the region. Citations from official EU statements and member state positions are provided for context and accountability.