Arab leaders on Tuesday endorsed Egypt's postwar plan for Gaza that would allow its roughly two million Palestinians to remain, in a counterproposal to US President Donald Trump’s plan to depopulate the territory and redevelop it as a beach destination.

The US$53 billion plan's endorsement by Arab leaders at a summit in Cairo amounted to a rejection of Trump’s proposal.

The summit conclusions were welcomed by Hamas, rejected by Israel and given a lukewarm response by the Trump administration.

Egyptian President Abdel Fattah el-Sissi expressed his appreciation for “the consensus among the Arab countries to support the reconstruction plan for the Gaza Strip, which allows the Palestinian People to stay on their land without displacement.”

In a social media post after the summit, el-Sissi said he looked forward to working with Trump, other Arab nations and the international community “to adopt a plan that aims for a comprehensive and just settlement of the Palestinian Issue, ends the root causes of the Israeli Palestinian conflict, guarantees the security and stability of the peoples of the region and establishes the Palestinian State."

The White House welcomed input from Arab nations, but insisted Hamas could not remain in power.

“President Trump has been clear that Hamas cannot continue to govern Gaza,” White House National Security Council spokesman Brian Hughes said.

“While the President stands by his bold vision for a post-war Gaza, he welcomes input from our Arab partners in the region. It’s clear his proposals have driven the region to come to the table rather than allow this issue to devolve into further crisis.”

Hamas welcomed the summit’s outcome, saying it marked a new phase of Arab and Islamic alignment with the Palestinian cause and that it valued Arab leaders’ rejection of attempts to transfer Palestinians from their territories in Gaza and the occupied West Bank.

Israel has embraced what it says is an alternative US proposal for the ceasefire itself and the release of hostages taken in Hamas' attack on southern Israel on October 7, 2023, which triggered the war.

Israel has blocked the entry of food, fuel, medicine and other supplies to Gaza to try to get Hamas to accept the new proposal and has warned of additional consequences, raising fears of a return to fighting. (AP)