Airstrikes have already begun ahead of an expected offensive by Russia on the province of Idlib, the last rebel stronghold in the country.
The chances the rebel forces will be able to win the civil war now is “extremely limited”, according to a letter read out by Dutch Foreign Minister Stef Blok and Minister for Foreign Trade Sigrid Kaag.
The Netherlands spent €80million (£71million) on programmes in Syria in order to support “moderate” anti-government groups during the civil war, but these “failed to bring the expected results”.
The support for militants will end immediately, but the White Helmets will be funded until December.
However, the Netherlands continue to support the Syrian people, strive for a political solution to the crisis and support Syria’s neighbouring countries which have been affected by the war.
The news comes amid controversy surrounding an investigation released on Monday by two of the country’s news outlets, Nieuwsuur and Trouw.
The papers revealed that at least one militant group receiving Dutch funding had been labelled a terrorist organisation by their own justice department.
A Dutch man is being prosecuted in Rotterdam for joining Jabhat al-Shamiya in 2015, a group that has received assistance from the government.
His indictment described the group as “jihadist” and a “criminal organisation with terrorist intent”.
Jabhat al-Shamiya is an umbrella group for Turkey-backed rebel fighters based in northern Syria.
In 2016 Amnesty International accused it of carrying out summary executions and running courts that enforce very strict Islamic-based law.
Five other militant groups identified in the investigation have been involved in human rights violations and cooperated with terrorist groups.
Dutch lawmaker Sjoerd Sjoerdsma described the news as “shocking” and asked: “How did this happen, despite all the warnings by lawmakers?”
Over the years, the Netherlands allocated €25 million (£22million) to the “non-lethal assistance” (NLA) programme that provided items such as phones, uniform, equipment and vehicles to 22 militant groups.
They also provided €12.5 million (£11million) to the civilian rescue service, the White Helmets, and €14.8 million (£13million) to the Access to Justice and Community Service Programme, which supports local police forces.