A special EU Programmes Body has granted €17.4 million for the project, which will see a bridge constructed at Narrow Water near Warrenpoint, County Down.
Patrick Clarke, also a Councillor for Newcastle, hailed the cross border trade the new iconic and symbolic bridge would open up between South Down and County Louth once constructed.
He said: “The significant funding boost today from the EU brings a reality to a project many local people thought might never happen a few short years ago.
“Once completed the cross-border bridge will not only enhance tourism in the area, but will also open up greater trade links between South Down and County Louth.
“The Alliance Party is dedicated to creating a future without divisions. This funding news will serve to increase greater community interaction across the border, which I can only welcome.”