The West Australian Government has abandoned plans to develop the state's newest national park within a coral archipelago, drawing ire from local tourism bodies.

The Houtman Abrolhos is a group of more than 120 windswept coral cays scattered off the coast of Geraldton, 400 kilometres north of Perth.

At a Liberal Party state conference in August, former premier Colin Barnett unveiled a plan to create a national park that would stretch across 90 per cent of the islands.

Twenty-one islands which house fishers' shacks, private jetties and Department of Fisheries infrastructure would have been excluded.

Camping would also have been offered for the first time under the project, in the hope of expanding tourism to the region.

At the time, Mr Barnett said the port city of Geraldton would reap significant economic rewards, as it was the ideal base for visitors to the Abrolhos.

But in a statement, new Environment Minister Stephen Dawson said the project would not be pursued by the McGowan Government.

The Abrolhos is a group of more than 120 islands off Geraldton. ( ABC News: Sarah Taillier )

"Plans to create the Abrolhos Islands National Park were announced by the former premier Colin Barnett before the 2017 state election as an election commitment," he said.

"While the McGowan Government is committed to the protection of world-class natural assets and the creation of national parks, our priorities for this term of government are the delivery of the commitments we brought to the election."

Since its inception as a commercial fishing zone, lobster and fishing permit holders have been the only people permitted to stay on the islands.

Tourism sector struggling

Jay Cox has owned and operated a cruise and charter business at the islands for 14 years and has long been pushing to boost tourism in the area.

He said the Government had made the wrong decision.

"All it's going to hurt is Geraldton and the Mid West," he said.

"There are a lot of businesses in Geraldton that are struggling.

"Tourism would go a long way to helping those businesses get more people into town.

"As it is now everyone just drives past Geraldton.

"We're not known as a tourism town and unless something happens in the tourism industry that gets people to stay for a while, everyone's going to keep passing it by.

"The Abrolhos would be a major attraction."

The Opposition has accused the Government of not offering an adequate justification for pulling the pin on the project.

Shadow minister for tourism Libby Mettam said the proposal had progressed through Cabinet, with fishing and tourism boundaries established prior to the March state election.

"The commitment wasn't made during the election campaign," she said.

"It was well and truly outside the election cycle.

"What has happened here is we've seen a new Government come in and withdraw the support for something that was clearly progressing."

The area is the site of several shipwrecks, including the infamous Batavia, which was carrying gold, silver and 180 people when it went off course in 1629, and the Zeewijk which was wrecked in 1727.