Despite the expected resistance of the Palestinian leadership, January 28, 2020, will be remembered as a historic date in the longstanding conflict. The “Deal of the Century” is the most detailed plan ever presented and it showcases a much-needed strategy shift for the region. The plan redefines the psychological borders of the conflict, which will enable the physical borders to be fixed at a later date.The continuous Palestinian rejection of any type of resolution since the days of the Oslo Accords has imbued them with a false feeling of strength that has harmed both them and the chances of a realistic settlement. From a historical perspective, their reluctance to reconcile themselves with the concept of a Jewish national home caused them to lose land. Every time they refused to share the land “between the river and the sea,” their proposed state shrunk in size. A look at the maps from the Peel Commission in 1937, the United Nations Partition Plan for Palestine in 1947, and the eventual cease fire border lines in the 1948 War of Independence show this graphically. When the Palestinians reached the conclusion that rejection does not pay, they recognized Israel’s statehood and signed the Oslo Accords. Not long after, though, the Palestinians reversed track with the intuition that their rejection would benefit them and increase the size of their eventual state. This theory was supported by empirical facts. The Israeli offers improved in each round of negotiations – from Camp David, to the Taba summit and later to the offer from Olmert to Abbas. So, rejection was deemed worthwhile and serious compromise was delayed.The “Deal of the Century” reverses this dynamic. The plan changes the psychology of the conflict and its resolution. Palestinian rejectionism will no longer benefit them. Rather, we have returned to the logic of the “Iron Wall” of Ze’ev Jabotinsky. Peace will only be achieved when Israel’s neighbors internalize that the nation-state of the Jewish people is here to stay. This has happened with Egypt and Jordan, and now comes the Palestinians turn to play ball as well.The US and other moderate Sunni Arab countries, whose representatives attended the unveiling of the plan, see Israel as a regional powerhouse, strong and capable. They see the reality as it is. Israel is a small country which has developed a strong and prosperous society based on Western norms such as democratic elections, a free press and an independent judicial system. Many modernizers in the Arab world greatly admire these characteristics. And it is these values that allow the Americans and Gulf nations to trust Israel as an honest player set to fulfill its part of the deal.A fascinating economic opportunity is offered also. For the first time, Israel’s security is not presented as a zero-sum game with the Palestinians. Rather, Israeli security control of the external borders is viewed as an economic saving and a business opportunity for the Palestinians. Instead of investing billions of dollars in establishing an external border guard, the IDF will protect the borders of both countries from a possible incursion of foreign enemies. The Palestinians will be able to invest these savings in crucial infrastructures such as schools, hospitals, ports, roads, industry and more.Therefore, while it is critical to analyze the security impact of the withdrawal from lands located in the Negev on the Egyptian border, there is no doubt the “Deal of the Century” provides a welcome strategic shift in the region. The redefinition of the psychological borders of the conflict will enable the physical borders to be fixed at a later date. The growing acceptance of Israel by the various Arab nations that appreciate the benefits of cooperation, alongside the economic incentives for Palestinians which lever both US generosity and Israel’s defensive capabilities, create opportunities that should not be missed – for Israelis, Palestinians and all of the region.The writer is a former chief of staff to Lord Janner in the UK Parliament, who today serves as chairman of the Isramarin Group and as a young diplomat at the World Jewish Congress.