The Papua New Guinea government of Prime Minister Michael Somare last week threatened to suspend all official visits by Australian officials, recall its high commissioner in Canberra, and refuse all “non-essential” aid. The diplomatic stand-off is another expression of the crisis facing the Howard government in the Pacific, with its aggressive efforts to maintain Australia’s hegemony generating widespread opposition in the region.

The Howard government largely got its way at the Pacific Islands Forum meeting held in Fiji last month. Australia’s Greg Urwin was reinstalled as Forum secretary-general, while Pacific leaders formally endorsed the “Pacific Plan”, which consolidates Australia’s strategic position through a series of regional economic and political reforms. Despite Howard’s apparent success, however, the summit resolved none of the underlying issues, and sharp political differences have immediately re-emerged.

Somare denounced the Howard government shortly after the Forum. He accused Australian Foreign Minister Alexander Downer of “acting like a colonialist” who still regards PNG as an Australian territory. “We are intelligent people—we are not just people you pluck from the jungle, and that is the impression you get from the foreign press, especially the Australian press,” Somare declared on October 26.

Tensions between Canberra and Port Moresby escalated after Downer announced a travel ban on all PNG ministers entering Australia. This came in response to Somare’s refusal to allow the extradition of Julian Moti, the Solomon Islands’ attorney-general.

The Howard government, which has witchhunted Moti in order to destabilise the Solomons’ government, orchestrated the attorney-general’s arrest while he was in transit at Port Moresby airport on September 29. Instead of handing him over to authorities in Australia, the Somare government encouraged Moti to return to the Solomons, which he eventually did on a PNG military plane. The Howard government seized upon the incident to press for a more compliant government in Port Moresby, and has cynically accused Somare of failing to uphold “good governance” and the rule of law.

The Sydney Morning Herald reported on November 1 that the Somare government had issued a “strongly worded” diplomatic note to Canberra demanding an explanation for the travel bans imposed upon PNG politicians. According to the article, Somare may retaliate if the Australian response is unsatisfactory.

Somare’s most significant threat is that of refusing Australian aid deemed non-essential. Australia’s annual aid to PNG is valued at $300 million, but only a small fraction of this is directed towards humanitarian assistance, such as health and education. The vast majority ends up in the pockets of Australian companies and personnel, and is aimed at bolstering Canberra’s control over the former Australian colony. About 40 Australian officials work in PNG as top officials, legal personnel, and police “advisors”, and are largely paid with aid money.

Under the guise of combating corruption and establishing “good governance”, the Howard government has attempted to secure direct control over the state apparatuses of a number of Pacific countries. Canberra suffered a setback last year when PNG’s Supreme Court ruled the presence of 115 Australian police officers unconstitutional. The police had been granted legal immunity under the “Enhanced Co-operation Program” which Canberra had previously bullied the PNG government into signing. While Howard was forced to withdraw the officers, he has spent the past year redoubling his efforts to install Canberra’s agents into crucial positions in Port Moresby.

This is now under threat. As the Sydney Morning Herald reported: “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.”

Somare and his colleagues clearly sense the danger in allowing Canberra to control these powerful positions. “There are fears John Howard and Alexander Downer are using aid to underpin their plans for potential regime change,” one unnamed official told the Herald.

Such fears are entirely warranted. After Canberra targeted the Solomon Islands’ government, the Australian-controlled state apparatus was used to destabilise the administration. The country’s attorney-general and immigration minister were arrested and detained by Australian police and presented before Australian judges, while the prime minister had his office raided and was threatened with arrest.

Canberra has already proven its willingness to manipulate the state apparatus in PNG against the democratically elected government. Julian Moti was arrested in Port Moresby after officials in Canberra collaborated with Australian personnel working in PNG, who then secured an arrest warrant without the knowledge of the Somare government or the state prosecutor.

Betha Somare, a PNG government spokeswoman (and daughter of the prime minister), denied the Sydney Morning Herald report the day after its publication. She admitted that the government had sent Canberra a letter asking for an explanation on the travel ban, but denied issuing any threat to cut-off Australian aid or take other punitive measures.

On November 3, however, Somare publicly declared that PNG was prepared to live without Australian aid. “If they threaten to withdraw aid, then by all means go ahead,” he declared. Referring to a newly developed nickel cobalt mine in Madang, valued at $US800 million, the prime minister said: “That in itself can be seen as a big step to move further away from Australian aid.”

The Madang nickel project, which is majority owned and operated by the China Metallurgical Construction Company, is the first major Chinese investment in PNG’s lucrative natural resources sector. Both Port Moresby and Beijing plan to develop further investment projects. Last month, PNG’s governor-general Paulias Matane met Chinese president Hu Jintao in Beijing, and welcomed further “cooperation” in the mining, forestry and fishing industries.

The rising influence of China in the Pacific underlies both the Howard government’s increasingly aggressive drive to protect its interests, and the ability of regional leaders to issue certain criticisms of Canberra’s role. A veteran of PNG politics, Somare has collaborated and jostled with different Australian governments for more than three decades. Beijing’s rise now provides significant room for manoeuvre, with Chinese aid and investment money providing a counterbalance to Canberra’s threats.

The entire political and foreign policy establishment in Australia has viewed with alarm the growing influence of China, Taiwan and other powers in the South Pacific. Critical strategic and economic interests are at stake in the region that Howard has declared as “Australia’s patch”. The economic interests are particularly evident in PNG, which is a multi-billion dollar market for Australian investments and exports, and has significant oil, gas, copper and gold resources.

The Howard government has not yet formally responded to Somare’s threats to cut-off aid and block the installation of more Australian personnel in Port Moresby. Given what is stake, however, there can be no doubt that Canberra is preparing to destabilise and remove the government unless its dictates are obeyed.