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Israel Proposes Hostage Deal as Fighting Continues in Gaza

Palestinians set out to Khan Younis with their belongings, from Rafah's Tel al-Sultan area after it was encircled by Israeli forces on March 23, 2025. (AFP)
Palestinians set out to Khan Younis with their belongings, from Rafah's Tel al-Sultan area after it was encircled by Israeli forces on March 23, 2025. (AFP)
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Israel Proposes Hostage Deal as Fighting Continues in Gaza

Palestinians set out to Khan Younis with their belongings, from Rafah's Tel al-Sultan area after it was encircled by Israeli forces on March 23, 2025. (AFP)
Palestinians set out to Khan Younis with their belongings, from Rafah's Tel al-Sultan area after it was encircled by Israeli forces on March 23, 2025. (AFP)

Israel has proposed an extended truce in Gaza in exchange for the return of about half the remaining hostages, Israeli officials said on Monday, as the military issued new evacuation orders and said "intense operations" were planned in the south of the enclave.

The latest proposals would leave open a final agreement over ending the Israel-Hamas war that has destroyed wide swathes of Gaza, killed tens of thousands of people and displaced almost the entire population since it began in October 2023.

But the proposals foresee the return of half the 24 hostages believed still to be alive in Gaza nearly 18 months after they were seized by Hamas-led gunmen - and about half the 35 assumed to be dead - during a truce lasting between 40 and 50 days, said the Israeli officials, who spoke on condition of anonymity.

Prime Minister Benjamin Netanyahu said on Sunday that Israel would step up pressure on Hamas but would continue negotiations "under fire". Continued military pressure was the best means of securing the return of the hostages, he said.

Netanyahu also repeated Israeli demands for Hamas to disarm although the Palestinian movement has rejected such calls as a "red line" it will not cross.

Netanyahu said Hamas leaders would be allowed to leave Gaza under a wider settlement that would include proposals from US President Donald Trump for the "voluntary emigration" of Palestinians from the narrow Strip.

EVACUATION ORDERS

On Monday, the Israeli military told Palestinians living in areas around the southern city of Rafah to relocate to Al Mawasi, an area on the shoreline.

"The Israeli army is returning to intense operations to dismantle the capabilities of the terrorist organizations in these areas," the military's Arabic language spokesperson said in a statement.

Hamas said at the weekend that it had accepted proposals made by Qatari and Egyptian mediators which security sources said would entail five hostages being released every week in exchange for a truce.

The Israeli military, which has cut off aid to Gaza, resumed operations on March 18 after a two-month truce, during which 33 Israeli hostages and five Thais were released in exchange for around 2,000 Palestinian prisoners and detainees.

Efforts to move to a second phase in the ceasefire agreement signed with U.S. backing in January have largely stalled, with no sign of movement to overcome fundamental differences between the two sides over the postwar future.

Israel has said Hamas' military and government capacity must be entirely dismantled and says the group, which has controlled Gaza since 2007, can have no role in the future governance of the enclave.

Hamas says it is willing to step back to allow another Palestinian administration to take its place but has refused to disarm and says it must play a part in choosing whatever government follows.

Israel launched its campaign in Gaza following an attack by Hamas-led gunmen on southern Israeli communities on October 7, 2023 in which about 1,200 people were killed and 251 taken as hostages into Gaza, according to Israeli tallies.

The military campaign has killed more than 50,000 Palestinians, according to Palestinian health authorities.

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Arab World

Investors Eye Syria After Trump Sanctions Move

Syrian watch a televised speech of President Ahmed al-Sharaa at a café in Aleppo (AFP) 
Syrian watch a televised speech of President Ahmed al-Sharaa at a café in Aleppo (AFP) 
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Investors Eye Syria After Trump Sanctions Move

Syrian watch a televised speech of President Ahmed al-Sharaa at a café in Aleppo (AFP) 
Syrian watch a televised speech of President Ahmed al-Sharaa at a café in Aleppo (AFP) 

An end to US sanctions on Syria is expected to mark a new era for an economy devastated by 13 years of war, opening the way for investment flows from the Syrian diaspora, Türkiye, and Gulf states that back the new government.

Business executives, Syria's finance minister, and analysts told Reuters they anticipated an influx of capital into the bankrupt economy once sanctions are lifted in line with President Donald Trump's surprise announcement, notwithstanding the many challenges still facing the deeply-fractured nation.

Billionaire Syrian businessman Ghassan Aboud told Reuters he was making plans to invest, and expected other Syrians with international business ties to be doing the same.

“They were scared to come and work in Syria due to the sanctions risks ... This will completely disappear now,” said Aboud, who lives in the UAE.

“I'm of course planning to enter the market, for two reasons: I want to help the country recover in any way possible, and second, the ground is fertile: any seed planted today can result in a good profit margin,” he said, outlining a multi-billion dollar plan to boost Syrian art, culture and education.

The lifting of sanctions would radically reshape an economy already set on a new course by Syria's new rulers, who have pursued free-market policies and shifted away from the state-led model adopted during five decades of rule by the Assad family.

The United States and other Western powers imposed tough sanctions on Syria during the war that spiraled out of protests against Bashar al-Assad's rule in 2011.

Syrian President Ahmed al-Sharaa said in a televised address late on Wednesday, that Trump's decision was historic and brave, and vowed that Syria would strengthen the investment climate.

“We welcome all investors from our homeland, both at home and abroad, and from our Arab and Turkish brothers and friends around the world,” he said.

The conflict has turned many urban areas to rubble and killed hundreds of thousands of people. More than 90% of the 23 million Syrians live below the poverty line, UN agencies say.

“There's a real chance for a transformational change in Syria and the broader region," said Timothy Ash, senior sovereign strategist for emerging markets at RBC BlueBay Asset Management.

Turkish firms and banks are expected to benefit from the lifting of sanctions, said Onur Genc, chief executive officer of financial group BBVA, whose group comprises Garanti BBVA, the second-largest private bank in Türkiye.

“For Türkiye, it's going to be positive because there's a lot of reconstruction needed in Syria. Who's there to do that? The Turkish companies,” he told Reuters.

“The lifting of the sanctions would allow the Turkish companies to go there now much better, and the Turkish banks to be able to finance them - so it will help,” he said.

Syria’s economy more than halved between 2010 and 2021, official Syrian data cited by the World Bank in 2024 showed. However, this was likely an underestimate, the bank said.

Syria's pound has strengthened since Trump's announcement.

Currency traders said it was hovering between 9,000 and 9,500 to the dollar on Wednesday, compared to 12,600 earlier this week. Before the war in 2011, it traded at 47.

Syrian Finance Minister Yisr Barnieh told Reuters that investors from the United Arab Emirates, Kuwait and Saudi Arabia, among others, had been making inquiries about investing.

“Syria today is a land of opportunities, with immense potential across every sector—from agriculture to oil, tourism, infrastructure, and transportation,” he told Reuters.

“We call on all investors to take this opportunity.”

Watching footage of Trump meeting Sharaa in Riyadh on Wednesday at his Damascus office, Karam Bechara, general manager of Shahba Bank in Syria, described excitement in the business community. “It’s too good to be true,” he said.

“We’re on the right track now internationally unless something happens in Syria that derails the process,” he said.

But Syria remains fragile.

Some armed groups have yet to turn their weapons over to the government, Kurdish autonomy demands are a point of friction, and sectarian violence has left minorities afraid of Sharaa's rule, despite his promises of protection and inclusive governance. Israel opposes Sharaa, saying he remains a jihadist, and has bombed Syria repeatedly.

Jihad Yazigi, editor of a leading newsletter on Syria's economy, Syria Report, said the US decision was transformative because it sent “a very strong political signal” and opened the way for its reintegration with the Gulf, international financial organizations, and Syria's big diaspora in the West.

Imad al-Khatib, a Lebanese investor, said he had accelerated his plans to invest in Syria after Trump's announcement.

Together with Lebanese and Syrian partners, he carried out a feasibility study for a $200 million waste sorting plant in Damascus two months ago. On Wednesday morning, he sent a team of specialists to Syria on Wednesday to begin preparations.

“This is the first step ... and larger steps will follow, God willing. We will certainly work to attract new investors because Syria is much larger than Lebanon,” he told Reuters.