Most of the built environment in Gaza has been severely damaged or outright obliterated, according to the United Nations and the World Bank, with the situation even more dire in Gaza City.Dawoud Abu Alkas/Reuters
The reconstruction of Gaza will require a new version of the Marshall Plan, the U.S.-led initiative that rebuilt shattered Western Europe after the Second World War. The comparison is not glib. In inflation-adjusted per capita terms, piecing together Gaza will cost the same, Middle East professors have said.
Vast swathes of Gaza, which had a prewar population of about 2.1 million in a small place – the strip is 41 kilometres long and 12 kilometres across at its widest – look like a moonscape.
“The devastation is on the scale of Hiroshima or Dresden,” says Yezid Sayigh, senior fellow at the Carnegie Middle East Center in Beirut.
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About 85 per cent of the built environment has been severely damaged or outright obliterated, according to the United Nations and the World Bank. The figure is higher in Gaza City. Water-purification systems, the electrical grid, fibre-optic networks, urban sanitation systems and farmland have been destroyed. Most hospitals and schools no longer exist or require reconstruction.
The UN, the World Bank and the European Commission put the repair bill at about US$70-billion, or almost 20 times the cost of rebuilding Gaza after the seven-week war in 2014 between Israel and Hamas.
Money talks, and countries and companies everywhere, especially in the Middle East, are sizing up their potential roles in one of the biggest rebuilding projects since the Second World War. But with the Donald Trump-inspired ceasefire only a week old – and fragile – predicting when shovels will hit the ground is fanciful.
A hundred questions need answers before billions of dollars will be committed. Who will pay? Under what terms and guarantees? Who will decide which projects will be awarded to which companies? Who will govern Gaza to ensure the stability of the long-term projects? What oversight systems will be adopted to ensure that the project does not focus primarily on making rich companies richer at the expense of poor Palestinians, almost two-thirds of whom lived below the poverty line even before the war began on Oct. 7, 2023?
Palestinians gather for Friday prayers amid the rubble of a destroyed building in Khan Younis.Jehad Alshrafi/The Associated Press
What seems certain is that, beyond providing immediate humanitarian aid, no one will start repairing Gaza until they are assured the war is truly over.
“The fundamental question haunting every planning session is not what will it cost but what guarantee exists that what is built today will not be destroyed tomorrow,” Habib Badawi, professor of international relations at Lebanese University, wrote in a recent report on Gaza’s reconstruction. “The question has no purely technical answer; it requires diplomatic breakthroughs, security guarantees and political settlements that have eluded the region for generations.”
Let’s assume miracles happen – that Israeli withdraws from most of Gaza; that Hamas, which appears to be re-establishing control of the strip, disarms and is replaced by an international security force; and that a structure, however vague, is fashioned to create a Palestinian state (the 20-point U.S. peace plan calls for “a credible pathway to Palestinian self-determination and statehood”).
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If even only some of these components come into place soon, there is little doubt an investment bonanza will be unleashed. It’s likely that the countries and institutions that would provide the main sources of funding, technical expertise, governance, project implementation and macroeconomic oversight are already forming Gaza committees. These include the wealthy Gulf States, the European Union, the United States, the World Bank, the International Monetary Fund and various agencies, including the UN Development Programme.
But none of them would actually get their fingers dirty in Gaza. The digging and banging would be done by private and publicly listed construction and infrastructure companies. Economists and professors close to the Gaza tragedy say that the biggies from Turkey and Egypt would have the upper hand, though Gulf, Chinese, EU and American companies might be recruited for some of the specialized or high-value work on, say, hospitals or solar-power networks.
The thinking is that the more foreign investment the better. Shopping malls, universities and ports developed by companies from the Gulf or Egypt, which has a peace agreement with Israel, might avoid getting hit in any new war between Israel and Hamas, if the latter manages to cling to power.
Turkish companies would get most of the work if Palestinians had their way. Turkish President Recep Tayyip Erdogan has been a consistent supporter of the Palestinian cause, to the point where he has called Hamas a resistance movement, not a terrorist organization. The risk is that Israel’s control of Gaza’s entry gates means the Israeli military could disrupt the supply lines for any Turkish company.
The destruction in northern Gaza, as seen from southern Israel.Leo Correa/The Associated Press
Turkey certainly has the capabilities to play the engineering and construction game. According to Mr. Badawi’s report, Limak Holding, Ronesans, ENKA Insaat and Kalyon Construction have “impressive” track records in building enormous infrastructure projects, often in unstable countries. ENKA was heavily involved in postconflict construction in Iraq and Libya; Kalyon was a member of the consortium that built the new Istanbul airport, the largest privately owned one in the world.
Egyptian companies would be less appealing to Palestinians, since Cairo helped enforce Israel’s tight blockade of the strip, which began in 2007, by restricting movement across its border with Gaza, at Rafah.
But Egypt has a lot of advantages. The shared border would simplify construction-material supply lines. Egyptian companies, many of them controlled by the Egyptian military, whose businesses include construction, food production, gas stations and hotels, have the scale and range to handle big developments. Some of the prominent Egyptian construction giants include Orascom, which is partly owned by Bill Gates’s Cascade Investment, Arab Contractors and Hassan Allan Holding.
Another name to watch is Consolidated Contractors, which is based in Athens but was founded by the late Christian Palestinian businessmen Hasib Sabbagh and Said Tawfiq Khoury, who were cousins. CCC, as it’s known, is one of the world’s biggest construction companies.
While money-making will be the immediate goal of all these businesses, there is a greater cause. The companies and their sponsor countries from the Middle East (perhaps even Israel) and beyond would share a desire for long-term stability in Gaza that could create jobs and wealth to give the strip a new lease on life. A prosperous Gaza stands a better chance of becoming a more peaceful Gaza.