The main beneficiaries of Rotorua's new Cy-Way will be the city's residents, but experts are expecting a tourism spin-off.
Construction for the 23.7km of shared paths is expected to begin late this year and be completed by mid-2018, with the aim of getting an anticipated 1700 people on two wheels daily.
Destination Rotorua marketing general manager Oscar Nathan said the Cy-Way contributed to Rotorua's image as a mountain biking Mecca.
"Rotorua is firmly establishing itself as New Zealand's home of mountain biking and as part of that, getting people out and about on two wheels is a key strategy.
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Advertise with NZME."The urban cycleway network fits perfectly into our existing efforts with other regions, creating the Ride NZ cycling and mountain biking marketing network."
Skyline Rotorua sales and marketing manager David Blackmore said most people arrive at Skyline by bus or car, but getting more people to arrive by bike would have benefits. "We get a few people turn up by bus, but biking would create a whole other avenue so I think it can only be positive."
Ngai Tahu Tourism Central North Island marketing manager Angela Best said Rainbow Springs were unlikely to see an impact from the Cy-Way.
"Overall for the community I think it's great, but I don't think it will draw a lot of traffic our way."
Deputy mayor Dave Donaldson said the Cy-Way would benefit the local population and the environment.
Mr Donaldson disputed the idea that money could be better spent on roading infrastructure.
He said urban cycle ways would be for everyone and lowering the number of cars on the road would also impact air pollution levels.
The Cy-Way will receive $1.5 million from the Urban Cycleways Fund, along with $2.09 million from the National Land Transport Fund and $1.93 million from local government.
