The Western-backed Palestinian Authority is relying on foreign aid to cover a 2012 budget deficit projected to reach $1.1 billion, but most donor countries have not fulfilled their pledges.

The World Bank said in a report released ahead of a meeting on Palestinian aid in Brussels next week that the Palestinian Authority has received just over half of the funds it needs.

Mariam Sherman, the World Bank’s director for the West Bank and Gaza Strip, called on donor countries to meet their pledges to help stabilize the Palestinian economy in the short term.

The report said a slowdown in growth in the Israeli-occupied West Bank, where the Palestinians have limited self-autonomy, “can be attributed to falling donor support combined with the uncertainty caused by the Palestinian Authority’s fiscal crisis, as well as lack of significant new easing of Israeli restrictions.”

Much of the aid comes from the United States, the European Union and Arab nations, and allows the Palestinian Authorities to pay the salaries of public workers.

Adding to its problems, the United States, which is trying to restart Israeli-Palestinian peace talks, cut off funding last year when Palestinian President Mahmoud Abbas defied calls from US President Barack Obama and made a unilateral bid for statehood recognition at the United Nations.

Palestinian officials say more than $150 million of US aid is frozen.

Meanwhile, a senior Hamas figure in Gaza, Mahmud Zahar, is visiting Tehran for meetings with top Iranian officials, media reported on Thursday.

Zahar’s trip was taking place shortly after Gaza militants and Israel agreed a fragile truce that ended four days of deadly cross-border violence.

Zahar, who serves as Hamas’s foreign minister, met his Iranian counterpart, Ali Akbar Salehi, who voiced his country’s support for the Palestinians.

The Israeli air force and Gaza militants traded sporadic fire overnight but a fragile truce between the sides that ended four days of violence appeared to be largely holding on Thursday.

Many schools across southern Israel were again closed on Thursday as a safety precaution, after briefly reopening on Wednesday for the first time this week.