Council leaders have described the decision to approve the Aberdeen Western Peripheral Route as an important step forward and a defining moment for the north-east.
Aberdeen City Council leader John Stewart and Anne Robertson, his counterpart at Aberdeenshire Council, said the 28-mile ring road will offer significant benefits to the region.
Mr Stewart said: “This long-awaited announcement is most welcome and gives a positive end to the year for Aberdeen and Aberdeenshire.
“Once work on the road has been completed, the AWPR, in conjunction with other major city transport projects, will impact on traffic and congestion levels in and around the city.
“It is a key piece of infrastructure allowing better access to and movement around the city delivering an even more attractive, business, leisure, retail and tourism destination.”
Aberdeenshire Council infrastructure services committee chairman Peter Argyle said the bypass would shape the development of the north-east for the next 25 years.
He added: “The project will play an important role in the future economic prosperity of the area, so this is an opportunity that we must grab with both hands.”
Kevin Stewart, chairman of regional transport partnership Nestrans, said the bypass would pave the way for new park-and-ride sites in Aberdeen, link rail-freight-transfer sites and allow for an improved transport system around Aberdeen Airport.
He said: “This is a defining moment for the north-east transport infrastructure.”
Tom Smith, chairman of Acsef (Aberdeen City and Shire Economic Future) said the bypass was “absolutely critical” to the region’s long-term economic future.
He added: “It is the linchpin for the new development plans, enabling us to significantly improve transport around Aberdeen City and Shire and build new developments in the right locations with the right infrastructure.”
But environmentalists claimed the announcement made a mockery of First Minister Alex Salmond’s appearance at the Copenhagen climate change summit last week.
Green Party co-convener Patrick Harvie said ministers may have accepted the Scottish Parliament's tougher climate targets, but they were determined not to let those targets affect transport policy.
“With this decision, the SNP have given a cold shoulder to the environment and a warm embrace to the roads lobby, based on a local public inquiry they rigged from the outset,” he said.
William Walton, chairman of Road Sense campaign group, said the road will bring about a 9% increase in emissions of carbon dioxide by 2026.
Colin Howden, director of lobby group Transform Scotland, claimed the bypass will do nothing to address traffic congestion in Aberdeen because the problem is caused by cars commuting into the city during rush hour.