Twenty years after the launch of the Arab Peace Initiative, no diplomatic solution for the Israeli-Palestinian conflict is yet in sight. Despite two decades of stalemate in peace negotiations, the situation on the ground has radically evolved in the past years. Several political developments have affected both Israel and the Palestinian territories. On the one hand, Israel has taken important steps in the process of normalisation with Arab countries, despite facing at the internal level a political deadlock which has brought the country to its fifth election in three years. On the other, last year, the Palestinian Authority (PA) drew some criticism after postponing the presidential elections scheduled for May 2021. The West Bank and Gaza were hit severely by the economic consequences of the Covid-19 pandemic and the Ukraine war, while the PA’s budget faces dwindling resources and a financial deficit. Although a resumption of peace negotiations is difficult to conceive under these conditions, the events of the spring of 2021 and August 2022 serve as reminders that the conflict can escalate at any given moment. Against this backdrop, what measures can be taken to improve livelihoods in the West Bank and Gaza? What measures can be taken to foster economic cooperation and relaunch the peace process? And what role can Arab states play in the quest for peace and development in Israel-Palestine? Can the regional integration mechanisms set in motion within the framework of the normalization agreements play a useful role in this respect?