Talking Points: Beyond The Conflict, The Gaza Reconstruction Plan and Its Global Impact
By the Basilinna Team
March 12, 2025
Arab leaders pose for group photo ahead of summit on Gaza. Source: AFP
Your Talking Points
Trump’s Gaza Proposal called for U.S. control, Palestinian displacement, and redevelopment into a tourism hub.
Egypt’s reconstruction plan, endorsed by the Arab League and Organization of Islamic Cooperation, supports Palestinian residency and PA-led governance.
Both Israel and the U.S. immediately dismissed the plan, citing feasibility and security concerns.
France, Germany, Italy, and the U.K. backed the plan, increasing diplomatic pressure.
The U.S. administration is reconsidering its stance, with Envoy Steve Witkoff acknowledging its potential.
What happened
Following the destruction in Gaza, two competing visions for its future emerged. The Trump administration initially proposed placing Gaza under U.S. control, forcibly relocating its Palestinian residents, and transforming the area into a luxury destination. Framed as a long-term solution, this plan was widely condemned as a violation of international law, dismissing Palestinian sovereignty and ignoring regional security complexities.
In response, Egypt introduced an alternative reconstruction framework, endorsed by the Arab League in Cairo and later by the Organization of Islamic Cooperation (OIC) in Jeddah. The plan, costing $53 billion over a 5-year-period, aims to rebuild Gaza while maintaining its Palestinian population. It proposes a technocratic governance structure under Palestinian Authority supervision, sidelining Hamas, and emphasizing infrastructure redevelopment, economic revitalization, and long-term stability. Crucially, it rejects forced displacement, positioning Palestinian-led recovery as essential to future security.
Initially, the U.S. and Israel rejected the plan. The White House argued that it did not adequately address Gaza’s humanitarian crisis, while Israel refused any arrangement that restored Palestinian governance. However, European nations, including France, Germany, Italy, and the U.K., endorsed the plan, elevating its legitimacy and pressuring Washington to reassess its stance.
In a notable shift, U.S. Special Envoy to the Middle East Steve Witkoff has acknowledged that the Arab plan has “compelling features,” describing it as a “good faith first step.” This shift suggests the administration is reconsidering its approach. Additionally, reports of direct U.S. engagement with Hamas indicate a potential break from long standing diplomatic restrictions which prohibit direct communication with designated terrorist organizations.
digging deeper
The U.S. reassessment of the Arab-backed plan reflects broader geopolitical changes. Historically, Washington’s policy toward Gaza has been shaped by alignment with Israel and reluctance to engage directly with Hamas or alternative Palestinian governance structures. However, growing European support for the Arab initiative has placed the U.S. in a difficult position. Maintaining its initial rejection would risk diplomatic isolation, while endorsing the plan could strain relations with Israel.
Direct engagement with Hamas signals a pragmatic shift. Since 1997, the U.S. has designated Hamas as a terrorist organization, refusing official dialogue. However, realities on the ground have made Hamas an unavoidable player in Gaza’s future. While formal recognition remains unlikely, backchannel discussions suggest Washington may be adopting a more flexible approach to diplomatic engagement. This shift aligns with historical precedent, as past administrations eventually engaged with groups like the Taliban once their influence became unavoidable.
The Arab League and OIC’s endorsement of the Egyptian plan highlights a regional push for greater agency in resolving Palestinian issues. Unlike previous Western-led initiatives, this plan is driven by Arab states, signaling a desire for Middle Eastern actors to shape their own security landscape. If successfully implemented, it could set a precedent for regional conflict resolution independent of U.S. or Israeli dominance.
For Israel, the growing acceptance of the Arab plan presents a challenge. While it has strengthened ties with Gulf states through the Abraham Accords, its outright rejection of the reconstruction framework risks undermining regional relationships. If Arab states continue advocating for Palestinian governance in Gaza, Israel may face increasing diplomatic pressure to engage with alternative solutions.
Looking forward, the U.S. has several options:
Align with Israel and reject the plan entirely, maintaining consistency with past policy but further straining relations with Europe and Arab allies.
Offer conditional support, allowing Washington to shape implementation while maintaining leverage over regional actors.
Fully endorse the plan and engage with all Palestinian factions, marking a dramatic shift in U.S. policy and setting the stage for broader diplomatic reengagement.
The administration’s recent statements suggest a move toward the second option—partial support with an emphasis on oversight. If this trajectory continues, it could represent one of the most significant shifts in U.S.- Middle East policy in decades. Whether this leads to a breakthrough or exacerbates existing tensions will depend on how Washington, Israel, and regional actors navigate the months ahead.
Published by Basilinna Institute. All rights reserved.
