Workers at the UN's Palestinian refugee agency in the West Bank have ended a two-month strike over low wages and poor conditions that paralyzed services in camps and shut down schools.
The United Nations has already said the cash-strapped agency was struggling to pay thousands of workers, while the IMF has warned of the danger of rising unemployment in the Palestinian territories if there is no progress in US-backed peace talks.
UN Relief and Works Agency chief Filippo Grandi announced an end to the strike late Thursday after a deal with workers, brokered by the Palestinian Authority, but gave no details.
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UNRWA expects the immediate resumption of all its services in the West Bank, including east Jerusalem, noting that the strike had "inflicted enough suffering on an already disadvantaged population."
Last month, police clashed with West Bank youths protesting against the strike, which had not only forced UNRWA to shut schools but also stopped rubbish collection from refugee camps.
The United Nations warned in November that UNRWA faces a "dire situation" with a $36 million (26.5 million euro) deficit.
The United States and European Union have traditionally been the biggest donors to UNWRA'S biennial budget of more than $1.2 billion.
Meanwhile, the International Monetary Fund warned Thursday of rising joblessness in the West Bank and Gaza Strip, with a stagnant economy dependent on progress in US-backed peace talks with Israel.
"Failure of the peace negotiations could trigger a political and security crisis that would lead to accelerated arrears accumulation and economic contraction, especially if donors signal scaling back their support," IMF envoy Christoph Duenwald said in a statement.
UNRWA was set up in 1950 to help Palestinian refugees who lost their homes because of the 1948 Middle East conflict. It estimates that it now helps about five million people.
The agency has also been strained by providing aid to the besieged Palestinian refugee camp of Yarmuk, on the outskirts of warn-torn Syria's capital Damascus.