The Political Reality of the Conditional Aid Given to Palestinian Civil Society Organizations

Conflict and Coexistence in Jerusalem

By Vishy Kandala ’24

How does conditional aid affect the operations of Palestinian civil society organizations? How has this ultimately undermined Palestinian autonomy?


“We do not ask to live like the rest of humanity, just a quarter of the life they live would suffice, no more,” says Muhammad, a 74-year-old man from Gaza whose sole income is from the Ministry of Social Development, which relies on the European Union (“Palestinian Lives at Risk”).

Since May 2021, the EU has withheld nearly $230 million worth of aid to Palestine until their school textbooks are changed (“Palestinian Lives at Risk”). In turn, these restrictions punish the millions of Palestinians who are dependenton western conditional aid to go about their daily lives. For the past 2 years, Muhammad has yet to receive any source of income to support his family (“Palestinian Lives at Risk”). Unfortunately, this is the current existence of many Palestinians.

My research question is two-fold: How does conditional aid affect the operations of Palestinian civil society organizations? How has this ultimately undermined Palestinian autonomy? This exhibit will discuss the political reality of conditional aid on the ground in the conflict. My groundwork examines the reality behind conditional aid and the barriers to accessing it, as discussed in interviews and academic research. Ultimately, I hope to show that western donors participate in the Palestinian civil society sphere in a hegemonic and neocolonial manner, often perpetuating dependence on western sources as opposed to building democracy from within.


Barriers to Receiving Western Conditional Aid

Terrorism accusations and its implications

With many western donors fearing association with terrorist organizations, there has been an implementation of counter-terror clauses within grant agreements to prevent terrorist funding; this forces NGOs within the Occupied Palestinian Territories to pass up the funding because it is impossible to meet the vague requirements (Alloush 2021).

The legal implications that come with counter-terror clauses in recent years are not favorable for Palestinian organizations either. With the United States’ Anti-Terrorism Clarification Act of 2018, any defendant “shall be deemed to have consented to personal jurisdiction” if they receive money from the ESF (Economic Support Fund) or INCLE (International Narcotics Control and Law Enforcement) (Graver and Anderson 2018). As INCLE is the only major stream of U.S. funding remaining, this controversial law allows for Israeli and Palestinian NGOs who have received aid from the United States to be tried in U.S. courts. Whereas U.S. courts have previously lacked authority and jurisdiction in Israeli and Palestinian claims (i.e., Waldman v. PLO, Sokolow v. PLO), the passing of this law allows for the U.S. to arguably step over its bounds simply because of its conditional funding (Graver and Anderson 2018). Because of this law, the Palestinian Authority has declined any aid from USAID (Zanotti 2018).

Moreover, given donor sensitivities with counter-terror restrictions, Palestinian NGOs’ structures are mainly funded on projects. With this project-by-project funding structure, however, NGOs in the area are prevented from having a complex and long-term impact. Additionally, these donors allow their grants to be allocated to indirect costs, so this structure allows for very little core funding and in turn, increases donor dependency (Alloush 2021). As a result of these laws and circumstances surrounding terrorism, many Palestinians have no choice but to adhere to U.S. policies, structures, and donors.


The Palestinian Authority’s Electronic Crimes Law

The Palestinian Authority’s authoritarian policies, such as the controversial Electronic Crimes Law, have contributed to the difficult political reality of the civil society space in Israel and Palestine. All Palestinian NGOs must register with the PA’s Ministry of Interior; this registration process means the sharing of detailed information with Israel, given the security coordination between the PA and Israel (Alloush 2021). With all of the NGOs private information on personnel, programs, financing, etc. accessible to the Israeli authorities, this leaves nonprofit organizations vulnerable to getting shut down (Alloush 2021).

This law generally heavily punishes anyone who is critical of the Palestinian authorities, and this includes several civil society organizations. The right to privacy and protection are further restricted, giving NGOs in the area another hurdle to get over. Although this is the dark political reality, it shows the importance of civil society organizations and their intended goal of expressing citizens’ ideas into the mainstream space.


Foreign funding law passed in 2016

In 2016, the Knesset passed a law that mandates human rights nonprofit groups that receive more than half of their funding from abroad to distinctly disclose their funding in official reports (“Israel passes law”). As it has been established that the majority of Palestinian nonprofits get their funding from abroad, this seemingly innocuous law has been criticized heavily in the past 6 years, as it has targeted Palestinian groups and excluded rightwing pro-settlement NGOs (“Israel passes law”). This law requires groups to declare their foreign funding dealings with officials, on TV, newspapers, billboards, and online (“Israel passes law”).

Many commentators have pointed out the double standard between Israeli and Palestinian NGOs; the Human Rights Watch stated, “If the Israeli government were truly concerned about transparency, it would require all NGOs to actively alert the public to their sources of funding, not just those that criticise the government’s policies” (“Israel passes law”). Although this law definitely has increased much-needed transparency with Palestinian NGOs, all NGOs in the area should be held to this standard. This law has created a social stigma around NGOs that receive their funding from abroad, therefore making the operations of Palestinian NGOs more difficult.


ESF conditions

As aforementioned, the United States’ Economic Support Fund has certain conditions that come with its aid. Some are as follows:

  1. No ICC (International Criminal Court) action: Assistance from the ESF for the PA will be prohibited if “the Palestinians initiate an International Criminal Court judicially authorized investigation, or actively support such an investigation, that subjects Israeli nationals to an investigation for alleged crimes against Palestinians” (Zanotti 2018).
  2. No membership in the United Nations: ESF aid will be retracted if Palestinians attain “the same standing as member states or full membership as a state outside an agreement negotiated between Israel and the Palestinians” in the United Nations or any U.N. specialized agency other than U.N. Educational, Scientific, and Cultural Organization (UNESCO) (Zanotti 2018).
  3. No aid towards a Palestinian state: No funds can be provided towards building a Palestinian state unless the Secretary of State has ensured that Palestine is cooperating in a peaceful existence with Israel, is taking measures to combat terrorism, and is working to establish “comprehensive peace in the Middle East” (Zanotti 2018).


These conditions coming from the U.S.’s main source of aid to the Palestinians leaves the Palestinian Authority and its civil society organizations dependent on western aid in the far future with no hope of autonomy. With no ICC action, membership in the UN, and aid towards Palestinian liberation, Palestine will continue to be in a state of limbo for years to come unless structural change is made.



As authors from the Middle East and Research Information Project put it: “In perpetuating the premise that Palestinian charitable bodies must adhere to American and Israeli political demands in order to be legitimate, the United States exacerbated fragmentation and exclusion in Palestinian collective organizing” (Alloush 2021).

As a possible solution, western donors can fund organizations long-term, instead of just projects. This can ensure complexity within Palestinian civil society organizations. In response to the fear of funding terrorism, Palestinian organizations have to be completely transparent with their donors. They can do this by making their annual financial statements available to the public, similar to many Israeli non-profit organizations. Additionally, as a possible idea to be less dependent on public governmental sources, Palestinian NGOs could be connected to databases full of private donors who normally engage with the region. This way, these donors are familiar with the area and aware of local contexts.

The implications of the conditional aid has far-reaching effects on Palestinian civil society. With the cycle of western conditional aid continuing with little regard to local contexts or the struggle, Palestinian NGOs are forced to continue to adhere to neocolonial policies. These programs undermine Palestinian autonomy and liberation greatly. Ultimately, providing more locally-minded aid will allow Palestinians to build democracy from within, as civil society organizations are intended to do.



Alloush, Basma. “Overcoming the Hurdles: The Struggle of Palestinian Humanitarian NGOs.” TIMEP, The Tahrir Institute for Middle East Policy,

Graver, Harry, and Scott R. Anderson. “Shedding Light on the Anti-Terrorism Clarification Act of 2018.” Lawfare, 31 Oct. 2019,

“Israel Passes Law to Force NGOs to Reveal Foreign Funding.” The Guardian, Guardian News and Media, 12 July 2016,

Staff, Al Jazeera. “Palestinian Lives at Risk If EU Continues to Withhold Aid: NRC.” European Union News | Al Jazeera, Al Jazeera, 24 May 2022,

Zanotti, Jim. “U.S. Foreign Aid to the Palestinians.” Congressional Research Service, 2018.