US envoy Steve Witkoff has announced the start of phase two of President Donald Trump's plan to end the war in Gaza, with a technocratic Palestinian government established in the territory.

Witkoff said the second phase would also include the reconstruction and full demilitarisation of Gaza, with Hamas and other Palestinian armed groups disarmed.

"The US expects Hamas to comply fully with its obligations," he added, noting these include the return of the body of the last dead Israeli hostage. "Failure to do so will bring serious consequences."

Under phase one, Hamas and Israel agreed a ceasefire in October, as well as a hostage-prisoner exchange, a partial Israeli withdrawal and an aid surge.