The increasing population in Egypt is leading to overcrowding in the Old Valley and delta area. The per capita reduction in arable land and water is likely to lead to serious problems. Egypt's chosen solution to this problem is the development of Southern Egypt. This will be known as the Southern Valley Development Project (SVDP) and will involve the irrigation and colonising of an area to the north-west of lake Nasser over a period of 30 years. This will increase the occupied area of the country from 4% to 24%. The area will be supplied with water via a new canal known as the South Valley Canal. It is planned to reclaim 0.21m ha by the year 2002, and at the end of the project some 1.43m ha will have been reclaimed. The surface water requirement of the project is 5bn m3, this will be provided by a strict water saving policy which aims to save about 11bn m3. The first part of this paper describes the background and detail of the project with particular regard to water resources. The latter part examines the pros and cons of the project highlighting some areas of concern.

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