Following Israel’s 11-day May blitz on besieged and blockaded Gaza, Egypt and Qatar each pledged to invest $500m in the reconstruction of the strip and have separately received at least tacit approval of their efforts from Israel. According to the UN, more than 2,000 homes were destroyed or severely damaged and 15,000 housing and commercial units sustained some damage. Water and sewage facilities, the sole electricity plant, schools, hospitals, primary health centres, and urban streets and rural roads were also targeted. Some 8,500 people were rendered homeless.

The cost of reconstruction has been estimated at $479 million while rebuilding from Israel’s 2014 aerial and land offensive has been put at $600 million. At that time, donor countries pledged $5.4 billion but delivered only $800 million, leaving homes, public buildings, and key infrastructure in ruins.

In June, Egypt commenced clearing the rubble of destroyed buildings ahead of infrastructure reconstruction. Significantly, Egypt also exported cement, metal bars and aggregate to Gaza through the Rafah crossing on border between the strip and Sinai. This cross-border trade needed Israeli agreement because the 1979 Egypt-Israel peace treaty specified the Karni crossing on the Gaza-Israel border as the sole goods delivery area and limited Rafah to human travellers.

The Erez terminal between Gaza and Israel was deemed the route for Palestinians to leave and enter Gaza from Israeli territory.

Qatar, which has had longstanding covert relations with Israel, opened financial channels to fund the rebuilding of more than 1,8000 destroyed or damaged homes and provides cash to support poor Gaza families. The arrangement bans the involvement of Hamas, which has ruled Gaza since 2007.

These positive developments appear to have led to the easing of Israel’s tight siege and blockade of Gaza. This depended on the fall of Benyamin Netanyahu’s hard right coalition following the 2021 election and could herald the adoption by Israel of a more humane policy toward the two million Palestinian citizens of Gaza where the unemployment rate is more than 50 per cent and the poverty level is nearly 60 per cent.

Netanyahu failed to form a government in May while Israel was, once again, dropping bombs on Gaza while Hamas fired rockets into Israel. He had counted on receiving a boost from this military campaign as well as a harsh crackdown on protesting Palestinian citizens of Israel. But, he and his partners could not muster the support of 61 members in the 120-seat Knesset unless he included the Palestinian United Arab List, Ra’am, in his new government.

His Gaza adventure, however, made it difficult for Ra’am’s chief Mansour Abbas to join Netanyahu’s coalition. He was reluctant to do business with him. For Netanyahu, including Ra’am would mean, for the first time ever, having a Palestinian party in the government and accepting the right of Israel’s 2-million strong Palestinian minority to be represented at the top level.

The presence of Ra’am, in particular, in any coalition would be highly controversial because the party is the Southern Branch of the Palestinian Islamic Movement in Israel. Israel banned the Northern Branch of the Islamic Movement in 2015 as its members refused to grant Israel legitimacy by standing for the Knesset. Furthermore, the parent of the Palestinian movements and similar Arab Islamic organisations, including Hamas, is the Muslim Brotherhood — which is outlawed in Egypt and the UAE.

The leader of the secular centre-left party Yesh Atid, Yair Lapid braved the traditional Zionist prohibition on including in his coalition a party representing Palestinian citizens of Israel. Lapid cobbled together a narrow government and placed at its head a right-wing religious figure, Naftali Bennet. This coalition is made up of seven Jewish parties from far left to far right and Ra’am.

While representing a wide spectrum of the electorate in Israel, the coalition’s component blocs and parties have become prisoners of the whole and cannot act independently without jeopardising the government. While there are tensions within the coalition over policy, its members are aware that they have to resolve differences or risk losing power. They have focused on domestic social and economic policies rather than courting fracture by addressing the divisive issues of the occupation, illegal settlements, the two-state solution, and the fate of the five million stateless Palestinians living under Israeli occupation.

Although Bennett is religious, pro-colonisation and opposed to a Palestinian state, his party is not one of the relative heavyweights in the coalition. These are the largest, Yesh Atid with 17 seats, Blue and White headed by Benny Gantz with eight, secular right Yisrael Beiteinu led by maverick Avigdor Lieberman with seven and centrist Labour under Merav Michaeli with seven.

Bennett’s right religious Yamina, centre-right-to right New Hope, and leftist Metetz, all have six seats while Ra’am has three. While the tilt of the coalition is “centrist” rather than right, the Israeli centre, including Labour, has moved rightwards for decades leaving only Meretz on the left in this coalition.

How does this situation impact Gaza? While Lapid, Bennett, and Ganz have recently served in major ministries under Netanyahu, they appear to recognise that his policy of exerting “maximum pressure” on Gaza is a failure. Gazans have not ousted Hamas and this policy is increasingly criticised by Israel’s traditional supporters in the international community and has boosted the Palestinian BDS campaign to boycott and sanction Israel and divest from Israel.

Human rights organisations and UN agencies have consistently characterised Israel’s treatment of Gazans as “collective punishment.” Between 2007, when Hamas took control of Gaza, and 2018, UNCTAD estimates that Israeli military operations, closures, siege and blockade has caused $16.7 billion in losses. “The damage from Israel’s military operations was equivalent to around six times the Palestinian enclave’s annual gross domestic product (GDP) in 2018.” In response, the coalition seems to have decided to reduce pressure and provide Gazans with some relief from the harsh siege and blockade, thereby polishing Israel’s image which has been tarnished by years of punitive measures.

In addition to allowing Egypt to rebuild with materials it delivers through Rafah and Qatar to restore housing and distribute $20 million in financial relief to poor Gazans, Israel is once again issuing work permits for Gazans seeking jobs in Israel. Last week tens of thousands of Gazans lined up to apply for 2,500 permits remaining from the 7,000 to be granted. Israel says the lifting of further restrictions depends on calm along the border. Hamas appears to agree.

Since Israel’s 2008-09 onslaught on Gaza, Hamas has repeatedly demanded the relaxation of restrictions as part of Egyptian-brokered ceasefire deals. Israel has, however, routinely ignored Hamas’ demands until this summer when the new anti-Netanyahu coalition emerged with the primary aim of ending Netanyahu-era mismanagement and corruption and providing Israelis with jobs, health care, and welfare benefits.