What the ‘Trump Gaza’ fantasy is meant to tell to the Arab world

US President Donald Trump appears to have finally accepted that his scheme to expel all 2.2 million Palestinians permanently from Gaza and have the US turn it into a "riviera" is unworkable. A week ago, Mr Trump was still insisting the Palestinians must be expelled, potentially never to return. However, this weekend he confirmed that Egypt and Jordan had refused to take the Palestinians, and the idea was now merely "a recommendation".

Although he has just posted a bizarre and deeply insulting social media video promoting an AI-generated, hallucinatory vision of “Trump Gaza” as a gilded playground for the global jet set, dominated by a giant statue of himself, Mr Trump’s obsession is and will remain a preposterous fantasy. Yet, it may have served some real purposes.

Conventional wisdom is that he was floating an unworkable scheme to pressure Arab states to craft a workable alternative for which they would bear the burden. GCC countries plus Egypt and Jordan met in Riyadh to discuss this. A full Arab League meeting in Egypt in early March is expected to, and should, provide plans for reconstruction and post-conflict stabilisation to finally end the Gaza war.

But Arab countries, Europeans and the Joe Biden administration were long pushing for a serious discussion on the bedrock of any such Gaza reconstruction plan: an alternative Palestinian civic administration.

Mr Trump has made it clear he does not want to inherit the Gaza war and wants all hostages released. He’s probably far more closely aligned on this with Arab countries than with Israeli Prime Minister Benjamin Netanyahu.

Mr Netanyahu has made it clear that the return of hostages isn’t his main goal. He continues to harp on the impossible task of destroying Hamas. That's why he resisted the three-phase ceasefire and peace plan floated last May by Mr Biden. He endured heavy pressure from the Israeli public on regaining hostages, and the Israeli military, which continued to lose soldiers to a low-intensity but deadly insurgency.

Hamas has recalculated because of the loss of the regional support network it was counting on for an extended insurgency: a robust Hezbollah, power-projecting Iran and compliant Syrian regime. Without these, it has lost the anticipated regional backing.

Moreover, the authors of the "permanent warfare" strategy initiated by the October 7 attack – militants in Gaza – are dead. The pendulum of power within Hamas has swung back to the politburo now gathered in Turkey. Many were never fully on board with the permanent warfare strategy, are keen on trying to rebuild power inside Gaza and can draw upon diplomatic, political and financial support from Turkey and Qatar, whereas military backing from Hezbollah and Iran is gone.

Trump has made it clear he does not want to inherit the Gaza war

Hamas, therefore, needs phases two and three of the ceasefire and the end of the war. Not Mr Netanyahu. He was dragged into phase one when Mr Trump added his own pressure to that of the Israeli public and military.

But Mr Netanyahu’s plan has become clear during phase one. By continuing to refuse to discuss any alternative Palestinian civic administration he has made a strategic choice to leave Hamas in power.

This is effectively a continuation of his traditional divide-and-rule policy towards Palestinians to thwart what the Israeli right fears most: Palestinian statehood. By dividing Palestinians between Islamist control in Gaza and secular nationalist rule by Fatah in the West Bank, the Palestinian movement is crippled and Israel can disingenuously claim it doesn't know who to talk to.

Mr Netanyahu is seeking a modified version of the status quo ante: Israeli withdrawal from most of Gaza, the return of Hamas to power and frequent if not continuous Israeli warfare against it – back to “mowing the grass" but keeping it barely above ground.

Israel’s leadership prefers to keep Hamas in power in Gaza – with the risk of future October 7s – than strengthen Fatah. They would prefer to empower, within limits and in Gaza only, Hamas rather than risk uniting Palestinians around those who want to talk to Israel and make a two-state deal.

Israeli Finance Minister Bezalel Smotrich has called Hamas an 'asset' for Israel. EPA

Israeli Finance Minister Bezalel Smotrich once said the quiet part out loud: Hamas is “an asset” while the PLO is the real “enemy".

Mr Trump understands the Israeli right and is surrounded by people deeply involved with it. So, he likely knows Mr Netanyahu’s intentions in Gaza amount to open-ended, albeit contained, warfare. And Mr Netanyahu fully understands that completing phase two functionally means the end of the full-fledged war.

Mr Trump and his colleagues realise that if Israel refuses to engage in phase two of the agreement, the remaining hostages will not be released, including an American. His rhetoric about "the gates of hell" opening means little, since they already have. There’s hardly more damage and destruction to be done in Gaza, and he has ruled out any US military action.

If the Arab states develop a practicable “day after" scenario in Gaza, for which they would be largely responsible, pressure will immediately switch to Mr Netanyahu to accept it. But that would mean acceding to the creation of an alternative Palestinian administration that, given the binary nature of Palestinian politics, would derive its power and authority ultimately from Fatah in Ramallah no matter what the formal designations may be.

So, while the Arab countries may feel unfairly pressured by Mr Trump to come up with an alternative, the more comprehensive and practicable their plan, the more of a trap it will constitute for Mr Netanyahu. He can say no, revealing that he is intent on maintaining Hamas power in Gaza no matter what he says about destroying it. Or he can agree and deliver a major win for Fatah (if they have the courage to take it).

Arabs have an excellent opportunity to flip the script, despite being properly outraged at Mr Trump's proposal to "clean out" Gaza and feeling unduly pressured. They can make the Israeli Prime Minister sweat as he says no to a plausible, serious and practicable alternative to more warfare and failing to secure release of the remaining captives or abandoning his own permanent warfare plan.

In the end, Mr Trump may shrug and say it's up to the Israelis to decide. But the nature of their decision will be clear to everyone, as will their deliberate, strategic choice to leave Hamas in power in Gaza and enter into precisely the kind of "permanent warfare" that the most militant elements in Hamas said they were seeking on October 7, 2023. Who will be the big winners then?