A plan to build the world’s longest single-track monorail through the pristine forests and rivers of New Zealand’s Fiordland is pitting growth advocates against environmentalists.

Developers want to build the track through the Snowden Forest, a part of New Zealand’s South Island classed a world heritage area by UNESCO. Opponents argue it will scar the landscape, whose Beech-tree covered mountains and snow-fed lakes featured in “The Lord of the Rings” films.

“Environmentalists need to be open to the fact that not all economic growth is necessarily bad,” said John Ballingall, deputy chief executive at the New Zealand Institute of Economic Research Inc. in Wellington. “It doesn’t have to be a binary choice between growth and no-growth.”

The monorail clash underscores a broader debate over the nation’s economic future. Prime Minister John Key’s center-right National Party government wants increased tourism, infrastructure and resource exploration to diversify an economy reliant on dairy farming and construction. With an election due next year, the main opposition Labour Party is likely to ally with the pro-environment Green Party to boost its chances of governing, putting some plans in jeopardy.

More use of the nation’s natural resources will be a critical component in meeting the goal of exports rising to 40 percent of gross domestic product by 2025, from about 30 percent, the government said in a December 2012 report.

New Zealand leverages its waterways, forests and mountains to attract tourists and uses the “100% Pure” tag to help sell dairy, meat and kiwifruit exports. Tourism contributes about 8.7 percent to GDP, down from 10 percent 10 years ago.

Decision Pending

Conservation Minister Nick Smith is waiting on officials’ advice before making a decision on the monorail proposal, a spokeswoman for the minister said. He’s unlikely to make the decision this year, she said.

“There really isn’t a valid reason not to approve this,” said Bob Robertson, chairman and majority shareholder of Riverstone Holdings Ltd., the company promoting the Fiordland Link. “It’s going to be essential that not only us but others facilitate tourism and spend some money on infrastructure.”

Critics say the very tourists he wants to attract will be turned off by the damage done to the landscape.

“The idea that you could carve a double line through the center of that incredibly beautiful piece of forest doesn’t make sense,” said Sarah McCrum, a former manager at the Takaro Lodge on the edge of the Snowden Forest, who’s among the more than 280 written submitters opposed to the project.

Quicker Trip

Passengers opting for the Fiordland Link would take a catamaran from Queenstown, an all-terrain vehicle over back- country roads and the 43-kilometer (27-mile) monorail ride, all in less than three hours. They would then connect with the existing road to Milford Sound, the region’s most popular destination. The Link aims to attract visitors who currently face a five-hour bus ride to Milford from Queenstown.

If approved, Robertson expects to spend NZ$200 million ($165 million) on the project, which he estimates would carry as many as 300,000 people a year. An estimated 140 construction jobs and work for another 300 suppliers would result, while as many as 100 people would be employed to operate the Fiordland Link, according to the project’s website.

Middle Earth

Film director Peter Jackson, who used locations near the planned monorail site in the “Lord of the Rings” films, has added his support to the campaign against the project.

“Our National Parks and World Heritage area were created to protect and preserve the beauty of our country for all New Zealanders,” Jackson said in comments circulated by protest group Save Fiordland and confirmed by his spokesman. “If we don’t conserve our natural heritage, we will lose it.”

Similar arguments have been raised by opponents of companies such as Anadarko Petroleum Corp., which plans to seek oil and gas off the coast, and Newmont Mining Corp. and Bathurst Resources New Zealand Ltd., who are preparing to mine for gold and coal.

“New Zealand is in danger of damaging the unspoiled oceans that are the heart of who we are,” said Greenpeace campaigner Steve Abel. “New Zealanders do not want a fossil-fuel future.”

The green-growth tension is also evident in the dairy industry, which makes up a quarter of New Zealand’s exports.

Parliamentary Commissioner for the Environment Jan Wright last month published a report on water quality that concluded that more intense dairy farming, and the consequent release of nitrogen in animal urine, was polluting the nation’s rivers.

“This investigation has shown the clear link between expanding dairy farming and increasing stress on water quality,” she said. “New Zealand does face a classic economy versus environment dilemma.”

Editors: Malcolm Scott, Matthew Brockett. To contact the reporter on this story: Tracy Withers in Wellington at twithers@bloomberg.net. To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net.

Photo Credit: Artist's rendering of the Fiordland Monorail. Fiordland Monorail