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We will punish you. We will bring you to your knees. Your actions will bring certain retaliatory vengeance down upon your heads. You will regret ever having crossed us.

We will stop taking all that aid money you send us.

PAPUA New Guinea is threatening to dramatically reduce the money it receives from Canberra, suspend all official visits by Australians or impose onerous travel restrictions, and recall its high commissioner.

Whether it does so, the Herald understands, depends on what response it receives to a strongly worded aide-memoire delivered to the deputy secretary of the Department of Foreign Affairs, David Ritchie, yesterday afternoon.

The diplomatic note demands an explanation for the bans Australia put on visits by PNG's Prime Minister, Sir Michael Somare, and its Defence Minister, Mathew Gubag, as well as its decision to cancel the next ministerial forum between the two countries. The letter also expresses disappointment at the "unilateral" actions taken by Australia.

The bans were announced by the Foreign Minister, Alexander Downer, a fortnight ago, after the escape of the Australian fugitive and Solomon Islands attorney-general designate Julian Moti on a PNG military aircraft.

The aide-memoire gives the Australian Government a week to respond. If no satisfactory response is forthcoming, PNG will retaliate, instituting a range of measures that promise to create havoc for Australia's $300 million annual aid program to PNG.

The most serious step being contemplated is the suspension of significant elements of Australian aid deemed not essential to PNG, the Herald understands.

PNG is also considering refusing Australia's demands for Australians to be appointed in the positions of deputy police commissioner and solicitor-general under the troubled Enhanced Co-operation Program. The developments signal a further deterioration in relations with PNG, and follow the Pacific Islands Forum in Fiji last week attended by the Prime Minister, John Howard, where Sir Michael accused Australia of being arrogant and of treating leaders in the region with contempt.

Other measures being threatened by PNG include suspending official visits by Australia entirely, or forcing officials to obtain diplomatic notes seeking PNG's approval when applying for visas. A fourth measure involving the recall of the High Commissioner, Charles Lepani, was flagged by Sir Michael last week.

Am I missing something in this supposed dire threat?

UPDATE: Wretchard explains it.

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