PMC, Sandline, was used to return the ousted president to power after a military takeover.

ECONOMIST: Why is the government planning to regulate mercenaries?

To achieve its task, Sandline was reported to have ordered an arsenal of weapons, including helicopters armed with rockets and machineguns.

ECONOMIST: Papua New Guinea

The crisis was sparked when Brigadier-General Jerry Singirok, the army chief, denounced the Sandline deal and called on Sir Julius to resign.

ECONOMIST: Papua New Guinea

The operation was successful, British troops followed in the footsteps of Sandline, and Tony Blair was recently hailed as a saviour in the country.

ECONOMIST: Why is the government planning to regulate mercenaries?

Apparently shaken by disturbances on the streets of Port Moresby, Sir Julius appointed a second replacement commander and announced a judicial inquiry into the Sandline deal.

ECONOMIST: Papua New Guinea

It is just not plausible that the very Mr Penfold whom the prime minister chose to shower with praise this week failed to report Sandline's activities to senior officials.

ECONOMIST: Ethics man

He says he will stand down until the report of the Sandline inquiry, expected in three weeks, and will try to bring forward a general election that was due in June.

ECONOMIST: Papua New Guinea

But nobody, the government now says, thought to mention Sandline's activities, or the investigation, to a foreign secretary known throughout his department for having put control of arms sales at the centre of his newly ethical foreign policy.

ECONOMIST: Ethics man