UNRWA's working budget is suffering from an 84-million-dollar (66-million-euro) deficit, Adnan Abu Hasna, a spokesman for the UN Relief and Works Agency, told reporters in Gaza City.

This will force UNRWA to take steps towards closing institutions, schools and clinics in the Gaza Strip beginning in September, he added.

He said that Arab states were to blame in part, having only paid for 1.5 percent of UNRWA's budget when they pledged to pay 7.5 percent, but that Saudi Arabia, Kuwait and the United Arab Emirates had paid their dues.

UNRWA made its latest appeal during a visit to the impoverished and overcrowded territory by Norwegian Foreign Minister Jonas Gahr Stoere, who echoed the call for donors to honour their pledges.

Norway holds the current chair of the UN Ad Hoc Liaison Committee, which coordinates aid to the Palestinians and is to meet on the sidelines of the UN General Assembly in September.

There are obvious needs that need to be met in water, electricity, sewage, health, schools and education, Gahr Stoere said, appealing for aid for the Western-backed Palestinian Authority.

It would be a grave mistake of the donor community to let down UNRWA in this situation, he added. Donors need to respond to that, especially, also ... donors in this region, he said in apparent reference to the Arab states...