Chinese control of Keswick Island tops submissions to inquiry on Whitsunday Island resorts

A parliamentary inquiry into Queensland’s island treasures has exposed the true depth of tensions between locals living in a problem-plagued paradise and the Chinese company controlling it.

Residents across Mackay and the Whitsundays are throwing haymakers at foreign control of the region’s island treasures, with some calling for them to be returned to “Australian hands”.

Their fury has returned to the fore in a number of submissions to a parliamentary inquiry into the state’s island resorts and Keswick Island, a paradise retreat off the Mackay coast, is at the centre of the storm.

Chinese developer Oasis Forest, formerly known as China Bloom, took on a 99-year lease over the island in 2019.

Tensions between the developer and residents emerged quickly and have continued into the present.

Dr Kerry Outerbridge, an orthopaedic surgeon who works in Mackay and lives on Keswick Island, said in his submission there had been a breakdown in communication between the head lessee and other residents.

“Residents have been continuously frustrated by a complete lack of communication between the CEO of China Bloom Ltd, Mr Nicho Teng and his subordinate Peter Jones,” he said.

Keswick Island. Picture: Mackay Tourism

“To our knowledge, neither of these men have ever visited Keswick Island until recently.

“They came to Keswick Island for six hours.

“A number of us went down to the barge ramp in hopes of meeting Mr Teng.

“Mr Teng did not speak to any of the residents, no eye contact was made as he walked up the ramp to an awaiting truck.”

Others were more blunt.

Suzanne Draper said the island’s environment had gone to pot since being taken over by a foreign entity.

“Keswick Island was the most beautiful natural island for tourists to visit and people to live in a peaceful and harmonious manner,” she said.

“Since being leased to a foreign country the environment, the habitats of native animals and the livelihood of our unique Australian creatures have been adversely affected.

“The island was a natural peaceful island to enjoy but now due to a foreign lease the island is no longer a place of tranquillity and harmony.”

Boats on Keswick Island. Chinese developer Oasis Forest, formerly known as China Bloom, took on a 99-year lease over the island in 2019. Picture: Jack Spratt

Peter Kennedy said the island should be returned to “Australian hands”.

“Many foreign countries do not allow foreign ownership of land in their area of control,” he said.

“It is vital that Queensland ensures ownership and control of all islands remains in the hands of Australians.”

Among the more extraordinary submissions was that of Shane Ryan who suggested Chinese control of Keswick Island posed a threat to Australia’s national security.

“I will give Australians a tip, World War 3 is (more) foreseeable now than any time in the past,” he said.

“The alliance of Russian/China is the biggest threat to world peace today in 2022, But still, we need to send these letters to warn of the situation of Keswick Island, not to mention Pine Gap. Why?”

In its submission, the Keswick Island Progress Association also raised concerns around the sale of the island to the Chinese company.

“The process excluded many potential Australian based developers who expressed a keen interest in purchasing the Head Lease and went to great lengths, unsuccessfully, to get more detailed information,” the submission states.

“We are aware of four parties ourselves and we assume there were many others.

“Why were they excluded and why did an overseas entity, Oasis Forest Ltd formerly China Bloom (Hong Kong) Ltd, succeed?”

The inquiry, run by the government’s Transport and Resources Committee, is investigating whether the economic and regulatory frameworks governing the islands are still fit for purpose.

Kurwongbah MP Shane King is leading the inquiry into the management of the state’s island resorts.

Despite the clear concern expressed in the submissions, Kurwongbah MP and committee chair Shane King said the issue of foreign ownership was not specified in the terms of reference for the inquiry and it was a “federal issue”.

“Leases are sold from leaseholder to leaseholder,” he said.

“I acknowledge that submissions have shown concern about ownership.”

The state government has the power to approve or reject the transfer or sale of a lease.

In its submission, Oasis Limited claims disjointed government decision-making and a lack of co-ordination has inhibited proper development on the island.

“There is a clear inconsistent tone in approach and assessment between local/state and commonwealth departments which must be rectified to allow lease holders to appropriately fulfil their obligations,” the submission reads.

Many of the region’s tourist jewels have languished over the years with little or no development.

Mackay Mayor Greg Williamson previously blasted the lessees of Brampton Island who have left the island resort to rot despite having approval to build a seven-star resort in its place.

Brampton Island.

United Petroleum, owned by United Petroleum co-founders Avi Silver and Eddie Hirsch, bought the island for $5.9m in 2010 and promptly closed the resort with a plan to redevelop it by late 2011.

Mackay Regional Council gave the development application, lodged by Brampton Enterprises Pty Ltd which is an arm of United Petroleum, the green tick in July 2015.

In 2017 Brampton Enterprises applied to extend its development application when it neared the expiration date – it now expires in July 2023.

Mr Williamson said the last correspondence the council had with the company was in 2019.

Resorts on Brampton, Long and South Molle Islands and Laguna Quays have also been unused for years, some for more than a decade.

The inquiry will examine how infrastructure access arrangements and other challenges for lease holders to develop or redevelop the islands.

South Molle Island resort was destroyed in Cyclone Debbie in 2017 and has been left to rot since.

The committee will also look into how the resorts can coexist within the protected Great Barrier Reef Marine Park Area and how native title and traditional owners are incorporated into operations.

Whitsunday MP Amanda Camm hopes the inquiry will drill into the complex issues of decision-making transparency and bureaucratic accountability to give the public a clearer sense of how approvals are negotiated and which level of government is responsible for what element of the process.

In a committee hearing on Monday, the complexity of the subject was already on display.

Queensland Tourism Industry Council senior research and policy officer Dr Esther Anderson struggled to give examples of “red tape” that could be removed to improve development or which government body should analyse the issue of excess bureaucracy when asked by Toowoomba North MP Trevor Watts.

Whitsunday MP Amanda Camm. Picture: NCA NewsWire / Dan Peled

“I am particularly interested in that, as someone who comes out of small business who loves dealing with other people’s red tape,” Mr Watts began.

“Could you give us some examples of things you might recommend to reduce or remove particular pieces of red tape and why? Do you have that granular detail?”

“Not at that granular level, but I do note that there are, I believe, 19 regulatory frameworks governing land use in the catchment area,” Dr Anderson replied.

“The ability to work through all that apply could make it a bit difficult to access, understand and work through those processes.

“Perhaps there is a need for guidance as well.”

Mr Watts continued: “If we as a parliament were looking to advise and understand how you might reduce that red tape, which department or area in government do you think would be the best to lead that analysis?”

Dr Anderson replied: “That is a difficult one to pinpoint, because a key need would be that co-ordinated approach, given that the terms of the inquiry, the marine park itself and businesses operating in the marine park cut across several government departments.

“It is difficult to give a concrete answer on that one.”

The inquiry will hold hearings in the regions in the coming weeks, appearing in Airlie Beach on August 23 from 2pm to 4pm at the Mantra Club Croc, in Mackay on August 24 from 4pm to 6pm at Rydges Suites, on Keswick Island on August 25 from 12.30pm to 2.30pm at Windward Spirit and in Yeppoon on August 26 from 9am to 11am at the Oshen Apartments.