Trump's Gaza Peace Board Faces Severe Funding Shortfall

The Board of Peace, established by U.S. President Donald Trump in January to oversee the administration and reconstruction of the Gaza Strip, is facing a severe cash shortage that threatens a $70 billion rebuilding plan for the devastated territory.

The U.S.-led board recently reported a large gap between financial pledges and actual disbursements, warning of an urgent liquidity crisis, according to Reuters.

However, experts monitoring international aid to Palestinians say the shortfall is unsurprising, stemming from the board's controversial structure, a lack of a viable political vision for a Palestinian state, and Israel's continued military expansion across the besieged territory.

Moath al-Amoudi, an expert on international aid to Palestinians, told Al Jazeera that the heavily publicized pledges resemble a "talk show" more than a genuine humanitarian effort.

"Out of the $17 billion pledged, the actual cash reaching the ground is zero," al-Amoudi said. "Donors are horrified to join a board that lacks a political vision and treats Gaza merely as a U.S. security protectorate."

A History of Broken Promises

The gap between pledges and actual disbursements is a historical constant in the Palestinian context, but the U.S. has a particularly poor track record, al-Amoudi noted.

After the 1993 Oslo Accords, the international community fulfilled only 70% of commitments. The U.S. ranked third in disbursements, far behind the European Union (over 95%) and Arab states. Similarly, after the 2014 war in Gaza, only 46% of the $2.7 billion pledged at the Cairo conference was disbursed after three years.

Today, the situation is far more complex. Unlike previous phases where aid targeted a recognized political entity like the Palestinian Authority, the Board of Peace essentially dismisses Palestinian political aspirations.

"Commercial Guardianship" and a $1 Billion Seat

Much of the international hesitation stems from the board's structure itself. Previous Al Jazeera reports show the board operates as a complex three-tier governance body packed with U.S. billionaires and pro-Israel figures, including billionaire Marc Rowan, U.S. envoy Steve Witkoff, Secretary of State Marco Rubio, and Trump's son-in-law Jared Kushner.

The board's charter includes a controversial clause: nations can bypass the standard three-year term and secure a "permanent seat" with a $1 billion contribution.

Al-Amoudi described this "pay-to-play" model as "commercial guardianship" and "unethical extortion."

Humanitarian Aid as "Political Blackmail"

The board's financial crisis is tied to strict political and security conditions. The U.S. three-phase plan demands the complete disarmament of Hamas and allied Palestinian factions as a prerequisite for reconstruction and border openings, while Israel continues to violate the October ceasefire agreement.

Experts argue that tying humanitarian funding to disarmament without offering an independent Palestinian state on the 1967 borders turns aid into a weapon.

"If the U.S. were an impartial mediator, they would offer a Palestinian state in exchange for disarmament. But offering only emergency relief in exchange for handing over weapons is not negotiation; it's submission by force," al-Amoudi said.

"Yellow Line" and Modern Ghettos

Beyond political and structural flaws, the volatile reality on the ground makes meaningful reconstruction nearly impossible. Despite a nominal ceasefire, Israeli forces continue near-daily violations, with 828 Palestinians killed since the "ceasefire deal" took effect.

Recent Al Jazeera satellite imagery analysis also reveals Israel systematically shifting the "Yellow Line" demarcating territory occupied by the Israeli military in Gaza. Israel has expanded control to 59% of the Strip through creeping encroachment.

With 85% of Gaza's buildings and infrastructure destroyed, donors are acutely aware that any infrastructure they fund could be bombed again, as happened during the Second Intifada.

Al-Amoudi concluded that the combination of Israeli land-grabbing and the Board of Peace risks causing severe demographic changes. "They want to place Palestinians in something like 'modern ghettos'—luxury prisons under 24/7 electronic surveillance and security. Any country with a minimum of ethics will not accept managing the largest prison in modern history," he said.