The problem I had—and have—with this question is that when evaluating (B) (I had already chosen (E) but went back and forth between them for some time) I considered any and all new businesses to be "local industries." As far as was concerned, once a business is established in a region, it's now a local business. And the economy in that region won't be improved if that economy—comprised of new as well as older businesses—is based on industries that would be harmed by new environmental protections.
All the benefits derived by moving those businesses to the region of natural beauty would be wiped out by the new environmental protections, regardless of what happened to older businesses. This neutralizes the argument's conclusion that such environmental protections could help the regional economy.
Once a business establishes itself in a place, is it not then a "local" business, any more or less than another similarly sited business? Does age or longevity in place determine the extent of locality?