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The contractor for the long-awaited Newtown bypass in Powys, which is expected to ease traffic problems, has been announced by the Welsh government.

Alun Griffiths Contracts Ltd will work on the 3.4 mile (5.6km) bypass with engineering and environmental support provided by Atkins and TACP.

Local politicians Russell George AM and MP Glyn Davies have welcomed the news.

Town mayor Val Howard said the town had been waiting 40 years and the bypass was "desperately needed".

Meanwhile, Mr George said the bypass would provide "much needed relief to residents and businesses".

"While it is a few months later than the Welsh government initially suggested, both the first minister and the transport minister have assured me that there will be no slippage in the project timescales."

Mr Davies said the bypass would be a "vitally important piece of infrastructure not just for Newtown but for the whole of Wales."

He added: "Newtown is situated on the very important north to south and east to west corridors of the A483 and A489 so this bypass is also of vital strategic importance.]

"Residents and business have suffered horrendous traffic problems for many years and this road will do much to ease those problems."

The scheme will improve safety, reduce congestion and improve journey times around Newtown.

Mayor Val Howard said there had been calls for a bypass since 1972.

"The latest news from the Welsh government is welcome, but after waiting 40 years for a bypass I'm sure a lot of people will still be apprehensive," she said.

"I sincerely hope it will take place because Newtown desperately needs a bypass."

Safeguard jobs

Transport Minister Edwina Hart: "I am delighted to be able to award the contract for this very important project, which will improve the quality of life for the people of Newtown and improve journey times and safety along the A483 and A489."

Other transport improvements, including footway and cycle ways, will be included in the contract. Once the bypass is completed, there will be further improvements to the traffic flow though the town, said Ms Hart.

"It is also encouraging to see that a Welsh company has won this tender, which will help safeguard Welsh jobs and result in money staying in the local economy," she said.

The next stage will the preparation of the preliminary design and publication of the draft orders, which is expected by April 2014.

The Federation of Small Business in Wales also welcomed the announcement.

Regional development manager Dai Davies added: "In time the traffic problems which are causing severe problems to businesses and residents alike will be a thing of the past."

But he warned that efforts must be made to ensure that signage in the town centre is of the highest quality, so that tourists will still be encouraged to visit.