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Ramallah, West Bank (CNN)Throngs of Gazans cheered as Palestinian Prime Minister Rami Hamdallah entered Gaza on Monday, the first visit he's made to the coastal strip in two years.

Hamdallah's arrival marked an important step toward the possible reunification of the Palestinian factions after Hamas violently evicted rival Fatah from Gaza in 2007.

The Prime Minister promised to heal the divisions and improve the lives of Gazans, who have been living under an Israeli-Egyptian imposed blockade and failing infrastructure damaged after several wars with Israel.

Palestinian Prime Minister Rami Hamdallah in Gaza on Monday.

On Tuesday, Hamdallah convened a meeting of the Palestinian Cabinet in Gaza, the first time such a meeting has taken place in the strip in three years. It comes less than a month after Hamas announced it would disband its Gaza "administrative committee"-- established earlier this year and seen as a direct challenge to the Fatah-led Palestinian Authority (PA).

Now, there is a renewed hope that the factions can succeed where a 2014 unity government failed.

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In the West Bank, the larger of the Palestinian territories in the hands of the PA, the recent signs of reconciliation between the two factions has created a sense of optimism.

At Birzeit University near Ramallah, students and faculty say this time feels different.

"They had to do it because the people are fed up with this division between Fatah and Hamas," Hussein Al-Rimmawi, a professor of political geography, told CNN.

"We hope that this unification will add strength to the Palestinians at the negotiating table with Israel. Possibly, this is a step in preparing something for Trump's deal," Al-Rimmawi said, referencing the US President's expressed desire to see peace between Israelis and Palestinians.

Mohammed Harhash, a 19-year-old economics student, believes reunification means giving hope back to the people of Gaza.

"It's so nice to see the Palestinian people uniting at last, because for the past decades we've been divided," says Harhash. "The people of Gaza have suffered for too long."

Mohammed Harhash, 19, and
Maha Abouhamdeh, 18, are feeling optimistic about the potential for Palestinian reunification.

The push for reunification comes as Gaza faces a mounting humanitarian crisis. The United Nations warns the coastal enclave may be unlivable by 2020. Electricity is available for only a few hours a day. The water quality is poor, while 75% of coastal waters are polluted with sewage because treatment plants are not running.

Maha Abouhamdeh, an 18-year-old psychology major, welcomes the unification but is leery of any side trying to dominate the unified government. "We are all together, Hamas, Fatah and the other political factions. We need to work it out together," she said. "If we put our hands together, we will be able to work for a better Palestine."

The Egyptian influence

Mohammad Shtayyeh, an adviser to Palestinian President Mahmoud Abbas, and a Fatah central committee member, shares this sense of optimism. "The difference is Egypt. Cairo has a vested interest in this reconciliation and wants to recapture its prestige in the region," he said.

Mohammad Shtayyeh: "I think it's a win win situation for everybody."

Egypt's General Intelligence Service worked with both sides to broker reconciliation talks. In September, Hamas said the negotiations were "an expression of Egyptian interest in Palestinian reconciliation, and [in] ending the division, and our interest [in realizing] the hopes of the Palestinian people by achieving national unity."

Eran Lerman, former deputy director of Israel's National Security Council, told CNN that he recognizes the strength of the Egyptians in the negotiations. "The Egyptian role is overt, aggressive and we basically have the same instinct as the Egyptians do when it comes to Hamas."

"Of course, they have a way of influencing in Gaza that Israel no longer has."

American approval

One main driving force behind the efforts for reconciliation comes from newly elected Hamas leader Yahya Sinwar.

"Without Yahia Sinwar this could not have happened," claims Shtayyeh. "He has two hats. He wears the Al Qassam (Hamas' military wing) hat, where he has credibility, and the politburo hat, where he [also] has credibility."

During an address to students in Gaza last week, Sinwar issued a warning in the starkest of tones: "I will break the neck of anyone who doesn't want the reconciliation, whoever he is, from Hamas or any other faction."

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Another important difference, according to Shtayyeh, is a green light from the Americans.

The United States and Israel previously opposed any unity government that included Hamas, whose charter includes a commitment to destroy Israel. Both countries, along with the European Union and others, consider Hamas a terrorist organization.

This time, the US has offered its backing to the new developments.

In a statement Monday, White House Special Representative Jason Greenblatt said the US welcomed "efforts to create the conditions for the Palestinian Authority to fully assume its responsibilities in Gaza," adding, "we will be watching these developments closely, while pressing forward ... to try to improve the humanitarian situation in Gaza."

The statement concluded: "Any Palestinian government must unambiguously and explicitly commit to nonviolence, recognition of the State of Israel, acceptance of previous agreements and obligations between the parties, and peaceful negotiations."

But on Tuesday, Israel's Prime Minister Benjamin Netanyahu warned against what he called "bogus reconciliations" which take place "at the expense of our existence."

In an apparent challenge to Abbas to face down Hamas, Netanyahu continued: "Whoever wants to make such a reconciliation, our understanding is very clear: Recognize the State of Israel, disband the Hamas military arm [and] sever the connection with Iran, which calls for our destruction."

A long road ahead

On the Palestinian side alone, there is still a long road full of obstacles in achieving full reconnection and unity between Fatah and Hamas. The first step is building the most basic foundation.

"We don't trust Hamas and they don't trust us, so we have to build trust," Shtayyeh told CNN. "Everyone has gone the first step in the right direction, and I think trust will be built gradually because we want this reconciliation to be a gradual process."

Among the first steps people in Gaza will be looking for is the PA lifting a series of punitive measures against the enclave -- including a block on electricity payments and government salaries -- which were seen as moves by President Abbas to turn the screw on Hamas.

But that will not come until next week at the earliest, PA spokesman Yousef al-Mahmoud said, after a further reconciliation meeting in Cairo.