Facing a major cash crunch, the United Nations agency working among Palestinian refugees has warned that its operation could come to a standstill. Commissioner-General Filippo Grandi, chief of UN Relief and Works Agency for Palestine Refugees in the Near East, has appeals to both traditional and new donors to step up support to help the agency sustain its operations.

"For the first time in probably decades, UNRWA is working in an emergency mode almost everywhere in the region where it operates," Mr Grandi told UN Radio in a recent interview.

Palestinian refugee children from Syria stands outside tents at Ain al-Helweh Palestinian refugee camp near the port-city of Sidon, southern Lebanon October 8, 2013. International donors must do more to help Lebanon absorb a flood of refugees straining its schools and public services, the head of the United Nations children's fund UNICEF said. Picture taken October 8, 2013. (REUTERS/Ali Hashisho)

The relief agency set-up 64 years ago to aid a Palestinian refugee population of 750,000 originally has now seen the refugee number growing over five million across Gaza, the West Bank, Lebanon, Jordan and Syria.

"The vulnerability of Palestine refugees is increasing, and with it their fears of marginalization and abandonment, the more so as humanitarian resources are diverted elsewhere," he said.

The agency is funded by voluntary contributions. With increasing number of refugees dependent on its aid, this year the organisation is facing a $48-million funding shortfall. The deficit, Mr Grandi says, will prevent the organisation from paying salaries to staff, eventually threatening to bring its operations to a standstill.

"These are difficult times to raise funds worldwide, especially since 2008 and the economic downturn," Mr Grandi acknowledged.

"It's been very difficult. Governments around the world, donor Governments in particular, are cutting their own public services and we're asking them to fund a public service for a population that has no State... that is in exile," he admitted.

Mr Grandi also briefed last week the General Assembly on the agency's annual report.

UNRWA has also been providing aid to over half a million Palestinian refugees registered in Syria. The ongoing conflict, however, has left over half of them internally displaced, while 60,000 others have fled to Lebanon and Jordan.

"We should not forget that the Syrian emergency is a very large, complex crisis that has many important components [and] a Palestinian dimension," Mr Grandi pointed out.

As Commissioner-General of UNRWA, Mr Grandi has been seeking to expand the agency's donor base beyond its traditional donors. The United States, the European Union and its members, Norway, Japan, Switzerland and Australia have over the years provided the agency over 90 per cent of funding for its basic programmes.

Mr Grandi's effort has been to expand the aid from Arab donors and countries in other regions such as Asia and Latin America. Reports said the Japanese government has made a contribution of $6.4 million to the UNRWA. The money will help the organisation provide 300,000 Palestine refugees with food aid during the second half of 2014.

Brazil and Turkey have also substantially increased their contributions to the agency.