Rebuilding Gaza: An Economic Analysis of Trump's Controversial Proposal
On February 4, US President Donald Trump announced his intention to take long-term ownership of Gaza, a highly controversial idea given not only the recent events of the Middle East, but the history surrounding the 360km² plot of land. Trump promises to clear the rubble and economically rebuild the area. The proposal includes relocating nearly 2 million Palestinians temporarily to other countries during the reconstruction phase. The global population is divided, with just under 50% of Arabs and Jews alike endorsing the move (46%, National Post, Error Margin 3.2%). But what could a US-owned Gaza do for Americans, Palestinians, and the world?
It's hard to stomach the economic costs associated with Trump’s proposal. Experts suggest that the initial phase of rebuilding infrastructure could run will into billions of dollars. It is likely that this estimate will increase as the Trump administration gathers information about the extensive damage from nearly five hundred days of conflict. Trump promises to rebuild homes, hospitals, and schools. “We’ll make sure it’ll be done world class, it’ll be wonderful for the people,” said Trump in a joint White House press conference with Israeli Prime Minister Benjamin Netanyahu. Despite presenting no clear plan, both Trump and Netanyahu feel confident their efforts will succeed.
Trump will need to discuss more with his Cabinet about available resources and next steps, many of whom were made aware of his idea with the public. The President’s Secretary of State, Marco Rubio, said he was first made aware while watching the press conference from a television in Guatemala. Rubio quickly responded with a post on social media, writing that “The United States stands ready to lead and Make Gaza Beautiful Again. Our pursuit is one of lasting peace in the region for all people.” (CNN)
In addition to funding for the infrastructure plan, Trump will need to find enough capital to support the relocation of millions of Palestinians. His plan suggests providing housing, food, healthcare, and other necessities for displaced individuals, while relocating them to nearby Arab countries including Turkey, Jordan, and Egypt. For many foreign nations, Trump’s insistence on removing civilians from their homes, even temporarily, is troubling. PBS interviewed one resident of Northern Gaza via interpreter. Ahmed Al Loudh told the team of reporters “The last thing we would do is leave Gaza. I'd rather die than leave, no matter the reason. Even if they said they'd give me a million dollars, I wouldn't leave my home, no matter the reason.” Back in Washington, Senator Chris Van Hollen (D-MD) called the idea “ethnic cleansing.” (PBS)
Trump also has opponents on the world stage. The government of Saudi Arabia said its position on having a Palestinian state run by Palestinian citizens was “firm and unwavering” and “non-negotiable and not subject to compromise.” Neighboring Jordan and Egypt expressed similar sentiments.
To be fair, if President Trump can find the necessary funding for the project and satisfy the international community’s concerns about a US-organized effort in Gaza, there may be economic benefits. A self-identified businessman at heart, Trump claims that rebuilding Gaza’s infrastructure will create thousands of new jobs and stimulate economic growth within the region. With hundreds of new businesses and positions to fill, Trump expects Gaza to grow into a flourishing economy.
A stable and developed Gaza also holds potential to attract foreign investment, boosting the local economy further. With international creditors and banks' support, Gaza could pave the way for new industries and international developments. Despite the conflict, Gaza’s agricultural sector has immense potential for growth. Investments in modern farming techniques and irrigation systems could help revitalize the Gaza economy.
Gaza also represents a strategic geographic location, serving as a major crossroads between cultures at East and West. Developing ports, improving transportation infrastructure, and establishing free trade zones can integrate Gaza into regional and international supply chains, helping to accelerate the economic rebuild.
While the potential for economic development and growth under a US-led economy is certainly promising, undeniably high costs and moral dilemmas pose substantial obstacles to the project’s success. President Trump has already made innumerable controversial statements and decisions since taking office less than a month ago, but this holds the potential to be his boldest stroke yet. Whether this decision will serve to harm or benefit the citizens of Palestine is yet to be seen, but it will certainly be a defining moment of the Trump Presidency.
References
"Up First Newsletter: Trump, USAID, DEI, Gaza." NPR, 5 Feb. 2025, www.npr.org/2025/02/05/g-s1-46559/up-first-newsletter-trump-usaid-dei-gaza.
"Most Israeli Jews Support Trump's Gaza Relocation Proposal: Poll." National Post, 5 Feb. 2025, nationalpost.com/news/world/israel-middle-east/most-israeli-jews-support-trumps-gaza-relocation-proposal-poll.
"How Trump Decided Gaza Strip Take Over." CNN, 5 Feb. 2025, www.cnn.com/2025/02/05/politics/how-trump-decided-gaza-strip-take-over/index.html.
"Middle East Leaders Condemn Trump's Idea to Remove Palestinians and Take Control of Gaza." PBS NewsHour, 5 Feb. 2025, www.pbs.org/newshour/show/middle-east-leaders-condemn-trumps-idea-to-remove-palestinians-and-take-control-of-gaza.