Arab leaders have approved a $53 billion reconstruction plan for war-torn Gaza, offering a direct counterproposal to United States President Donald Trump's controversial suggestion of depopulating the Palestinian enclave.

The decision was reached at an emergency Arab League summit held in Cairo on Tuesday, where Egypt unveiled its ambitious plan to rebuild Gaza while maintaining its Palestinian identity. The summit, attended by heads of state and senior officials from the Arab world, underscored regional opposition to any forced displacement of Palestinians.

“The Egypt plan is now an Arab plan,” declared Arab League Secretary-General Ahmed Aboul Gheit at the conclusion of the summit. Without directly mentioning the US proposal, he reaffirmed that “the Arab stance is to reject any displacement, whether it is voluntary or forced.”

Alternative to Trump’s 'Middle East Riviera'

The Egyptian initiative comes in response to Trump’s proposal, which called for the US to take control of Gaza and relocate its over two million residents to neighbouring countries. The American plan, which has been widely criticized as tantamount to ethnic cleansing, envisions a so-called "Middle East Riviera" that would transform Gaza into a coastal economic hub under American influence.

Trump, who has described Gaza as a "demolition site," recently posted an AI-generated video on his Truth Social platform depicting a glitzy, futuristic Gaza with a golden statue of himself, Israeli Prime Minister Benjamin Netanyahu sunbathing, and Elon Musk enjoying snacks on a pristine beach. The video has been widely condemned across the Arab world.

In contrast, Egypt’s plan, detailed in a 91-page document, prioritizes the political rights of Palestinians alongside reconstruction. Egyptian President Abdel Fattah al-Sisi, in his opening remarks at the summit, stressed the need for a parallel political process that leads to a two-state solution. However, Israeli Prime Minister Netanyahu has repeatedly rejected such a proposal.

Phased reconstruction and governance plan

The Egyptian proposal outlines a three-phase reconstruction plan spanning up to five years, with an estimated cost of $53 billion. The initiative is designed to be implemented in coordination with the Palestinian Authority (PA), marking a potential return of the PA to Gaza after 17 years.

The plan’s first phase, expected to last six months, will focus on clearing rubble and unexploded ordnance, particularly from Salah al-Din Street, Gaza’s main north-south highway. This stage also involves constructing 200,000 temporary housing units to accommodate 1.2 million displaced Palestinians and repairing 60,000 partially damaged buildings.

The second phase, spanning two years and requiring $20 billion in funding, will include extensive infrastructure restoration, such as rebuilding water systems, electricity grids, and telecommunications networks.

In the final phase, which is projected to take two and a half years with a budget of $30 billion, the focus will shift to large-scale development, including the construction of permanent housing, an industrial zone, a commercial port, and an international airport.

The plan proposes that a "Gaza Management Committee"—comprising independent Palestinian technocrats—take charge of governance, effectively sidelining Hamas. The document, however, does not specify the group’s role in the transition. While Hamas has indicated willingness to relinquish administrative control, it has drawn a firm line against disarmament, a key demand from Israel.

Security and International Support

Security remains a major unresolved issue in the proposal. The plan calls on the United Nations Security Council to consider deploying international peacekeepers to Gaza. Additionally, Egypt and Jordan have pledged to train Palestinian security forces to maintain order during the transition.

Funding for the ambitious project is expected to come from Gulf states, the United Nations, and international financial institutions. However, investors remain wary of putting resources into a territory that has faced repeated cycles of destruction.

“Wealthy nations may be willing to invest, but no one wants to build only to see everything collapse in another war,” said a senior Arab diplomat who attended the summit.

Opposition from Israel and the US

Despite broad Arab support, the proposal faces significant roadblocks from Israel and its allies. Netanyahu’s government has dismissed the idea of the Palestinian Authority returning to Gaza and remains committed to eliminating Hamas.

Israel has also reiterated its backing for Trump’s vision, which aligns with the long-held stance of the Israeli far-right advocating for the depopulation of Gaza. In response to the Cairo summit, a senior Israeli official stated, “Arab states need to break free from past constraints and collaborate on ensuring long-term security in the region.”

Egypt swiftly rebuked Israel’s stance, with Foreign Minister Badr Abdelatty calling it “unacceptable” and accusing Netanyahu’s government of “stubborn and extremist policies.”

While the Arab League’s approval of the Egyptian plan marks a significant diplomatic development, its implementation will depend on overcoming resistance from Israel and securing unwavering financial commitments.