Southland is in line for almost $2 million from the government's provincial growth fund.
The government this morning announced the funding for three feasibility projects in the region - the redevelopment of Invercargill's central city, an aquaculture hatchery, and an expansion of the sheep and goat dairy industry.
Almost $1m is being set aside for Invercargill's CBD development, and almost $500,000 each to the other two projects.
Southland District's Mayor Gary Tong said it was a boon for the region, which was thriving.
"I believe it's fantastic news for all the work that's gone in behind the scenes ... and for the provincial growth fund team to actually acknowledge we can deal with this down here is just fantastic," he said.
About $400,000 would fund a business case to assess the development of a state of the art, land-based commercial hatchery to produce salmon smolt and mussel spat which had the potential to create more than $400m in export earnings and 500 jobs for the region, the government said.
The fund was also investing $490,000 in FoodSouth to scope further development of the sheep and goat milk industry.
Mr Tong said the projects were huge for Southland and could lead to important job creation in the region.
Invercargill Mayor Tim Shadbolt was also excited by the funding and said the government's contribution to the redevelopment of Invercargill's CBD was a morale boost for the city.
Mr Shadbolt said the funding would help with the practical side of earthquake-strengthening in the CBD and boost the image of the central city, but it also showed the faith the government had in the wider region.
"We represent only 3 percent of New Zealand's population but represent 18 percent of our export earnings," he said.
"So I think it is a vote of confidence from the government."
Mr Shadbolt described the funding as another "great leap forward" for the city and region following the reopening of the fourth potline at Tiwai's Aluminium Smelter, the opening of a venison chain at Alliance's processing plant in Lorneville, and the announcement of direct flights between Invercargill and Auckland.
Parliamentary Under-Secretary for Regional Economic Development Fletcher Tabuteau said all the projects were important to the region and its future development.
"It's great to see the PGF's involvement in all three projects which demonstrate exciting opportunities to develop Southland's high-value industries, and the revitalisation of Invercargill," Mr Tabuteau said.
"These projects align with the Southland Regional Development Strategy, led by the Southland Mayoral Forum. Creating vibrant urban centres, innovation and extending industries like aquaculture are all goals for the Southland region."