The United States Congress has blocked $200 million in aid for the Palestine following the request of the Palestinian President Mahmud Abbas to join the UN, the Independent daily said on Saturday.
The cutoff threatens food aid projects as well as health care and support for efforts to build a functioning state, the daily said.
According to the Independent, the decision to delay the aid payments contradicts the Obama administration since the support of the Palestinian people is what the U.S. officials describe as "an essential part of the U.S. commitment to a secure future and two-state solution for Palestinians."
The administration remains, as does Congress, opposed to the Palestinians' UN statehood bid.
So far eight out of the fifteen members of the UN Security Council are ready to support an independent Palestine joining the UN.
In order for a Palestinian state to be officially recognized by the UN, nine out of the 15 Security Council members should back the Palestinian bid - and none of the Council's permanent members should be opposed to it. But the United States has already said it will veto any statehood resolution.
In case of the U.S. veto, the Palestinians can still ask the General Assembly to elevate their UN status from an observer to a "non-state member," which some analysts say would enable them to challenge the continuing construction of Israeli settlements on the occupied Palestinian land in the International Criminal Court. A total of 131 UN member states, making up more than two-thirds of the organization's members, have recognized an independent Palestinian state.
The settlement construction issue has been cited by Palestinians as the main obstacle to resuming peace talks with Israel.