A group calling itself al Qaida's European branch has threatened to turn Australia into "pools of blood" if it does not withdraw its troops from Iraq. Canberra has blamed the threat, which also was made against Italy, on the decision by the Philippines and Spain to pull their forces out of the Gulf.
The threat was posted on the Internet by an organization calling itself as the Islamic Tawhid Group.
The Australian government says it knows very little about this shadowy group, which has promised to unleash a wave of violence if Canberra refuses to withdraw its forces from the Iraq.
The threat could be a hoax but the authorities here are taking it seriously.
The message warns Australians that lines of car bombs will shake the earth under their feet if the group's demands are not met.
It says if Australia follows "the path of the Philippines and Spain and removed its soldiers from Iraq, a safe and secure life would be guaranteed."
Australia insists it will not be intimidated into withdrawing its troops.
Foreign Minister Alexander Downer has blamed the authorities in Manila and Madrid for encouraging radical groups. Mr. Downer said Monday the worst thing a government could do was to cave in to terrorist demands.
Opposition politicians in Australia think the government has overreacted. Labor spokesman Kevin Rudd says it has upset an important regional ally.
Mr. Kevin Rudd said, "I question the wisdom of Mr. Downer declaring World War Three on the government of the Philippines. The Philippines is a very important country in this respect. We have Jemaah Islamiyah, we have Abu Sayef and other terrorist organizations at work within the Philippines and elsewhere within Islamic Southeast Asia."
Manila has fired back at Australia, with one official calling Mr. Downer's comments "narrow minded."
In a speech to the national parliament, Philippine President Gloria Arroyo made no apology for withdrawing her country's troops to save Filipino truck driver, Angelo de la Cruz. Mr. de la Cruz was kidnapped by militants in Iraq, who threatened to kill him unless the Philippine troops pulled out. Mr. de la Cruz is now safely back at home.
In Australia, the future of 850 troops will be a key issue in a federal election expected here later this year. The main opposition party has promised to bring Australian soldiers home by Christmas. The government says they will stay as long as they are needed.