 Hello and welcome to Development Futures, a podcast brought to you by the Indo-Pacific Development Center here at the Lowy Institute. My name is Roland Rajar and I'm the Director of the Center and your host for this episode. In this podcast, our researchers and other leading experts discuss fresh policy insights and ideas on the most pressing development issues in the world today. In this episode, I'm sitting down with two of our own in-house experts to discuss the outlook for global climate policy with a particular focus on what this means for development. Both of my colleagues are really top quality experts on climate and development and in particular on climate finance and I have to say I always enjoy hearing what they have to say and I'm really glad to have them both here on the podcast to share their thoughts with all of our listeners. So first, let me give you a brief introduction for both of my colleagues, first is my colleague Dr. Melanie Pill who is a climate policy research fellow in the Indo-Pacific Development Center here at Lowy and specializes in particular on the climate related issues facing the most vulnerable developing countries. Also we have our other colleague, Cheryl Lyons, who is also a climate policy research fellow in the center and specializes in particular on climate energy finance and green banks and has also spent a lot of time working on Australian climate policy. Cheryl and Melanie, welcome to the podcast. Thanks for having us. Yeah, great to be here. So Melanie, let's go straight to you. You were at COP28, the global climate summit in Dubai, participating in lots of presentations and expert panels. And one of the big outcomes from COP28 was of course the loss and damage fund. It's something right up your alley, an area of expertise for you. So can you tell us, what is loss and damage all about? And what do our listeners need to know about this new fund? Yeah, sure. Yeah, it was indeed a really big milestone after over 30 years of sort of inaction on loss and damage. And when we talk about loss and damage under the United Nations Framework Convention on Climate Change, we're talking about the impacts that are caused by climate change on countries. And these can be extreme weather events, for example, which are your tropical cyclones and your floods. But we can also, we also talk about slow onset events, which are specifically detrimental to the Pacific sea level rise, salinization. And then we also look into non-economic losses, for example. Things that happen to people, loss of lives, loss of biodiversity, and loss of culture. So these are all intangible, non-economic loss. And there's then human mobility, for example. People already have to move away from coastlines and that goes into justice. So it's kind of a never-ending story when you talk about loss and damage from climate change. That's why it's not surprising that this fund was such a major breakthrough for a lot of developing countries. And when it comes to this fund, we had it operationalized at COP28. The governing body of that fund was agreed on. But there were many issues that are still associated with it. And they had to talk through, the transitional committee had to talk through during the course of 2023. And one particular one was that the World Bank is now the host of the fund for the next four years. That means that some of the processes within the World Bank need to be adjusted in order to fit sort of the United Nations system. So the bank system is completely different from what we know in the United Nations. Then there's also problems with the eligibility criteria. Which of the countries are going to be eligible for the funds? Which of the countries can access the money that is there? What can they access it for? And then also very important is the direct access criteria for some of the countries and also country ownership of projects. So this all needs to be done throughout the next year. And the World Bank has a mandate, for example, to finalize their internal processes within the next eight months. I guess the big question, though, is how much funding will there be for this loss and damage fund? How much do we know about that? So at the moment, we have pledges of about $700 million from a few countries that made pledges to the fund. But of course, that's nowhere near enough of what is needed to address all the loss and damage that is currently caused by climate change. I presume there's quite a long road ahead in terms of not only standing up the fund, but also just funding the fund properly. Absolutely. Yes. We're going to come back to climate finance. So I just want to go to you, Shell, now. The other big outcome from COP28 was the language and the final agreement to quote, unquote, transition away from fossil fuels. Now, I think the reaction in the media and so forth was saying how this was a historic first in terms of recognizing this and this kind of language. I suppose for many people, myself included, it looks like a fairly small incremental change in language in a non-binding sort of agreement. And so it seems like a kind of weak outcome, really, in many ways. But you're the sort of expert here. And what's your take? Do you see this as a historic achievement or is it more of a big letdown? Well, I think you're absolutely right that it is a very incremental outcome, Roland. And so I think it was really interesting that the fossil fuel text and outcome received very disparate reactions from various experts in the media. And some people were very dismissive and others did regarded as a historic breakthrough. And I guess the way that you perceive the outcome depends on how you're actually, what criteria you're using to judge it. So if you look at it in terms of the science of climate change and what we actually need to do to reduce emissions, it was completely inadequate. It was not the phase out of fossil fuels that the president of the COP had been talking up as we led into it. But I think if you look at multilateralism as incrementalism, which is what generally sort of occurs in COPs is these very small step forwards that make meaningful change over time. And are sometimes sort of interspersed with very significant steps forward. Well, then it actually, it was significant because it was the first time that fossil fuels were sort of mentioned in the texts. And we have a roadmap now to sort of think about where fossil fuels need to go through the multilateral negotiations. So I think it was disappointing given the high hopes that many had leading into the conference that there would be a breakthrough beyond what had happened in Glasgow and through the G7 meeting at Sapporo, but it was still a small step forward. So I suppose thinking then that it's about incremental steps forward and then hopefully some occasional breakthroughs. I suppose the reality is though that the situation is rather urgent and so incrementalism is not necessarily what we need right now. But just in terms of global climate policy, I mean then what's the next steps? What's the next opportunities to sort of build on this and take us forward? Also I think the UNFCCC plays a really fundamental role as the key multilateral forum on climate, but its job primarily is to sort of make these incremental steps and set a baseline. And so often what we see with global climate action is that the really the significant step forwards happen on a bilateral level, often between key emitters such as the agreement that was brokered on accelerating renewable energy between the US and China in the lead up to the agreement. And so I think this year is going to be really interesting because we had both special envoys on climate for the US and China retire at the end of last year. And they had had a very constructive relationship even where the US and China had faced tensions in other areas of their relationship. So I will be watching very closely and I expect many other climate analysts to be watching very closely to see how the new appointees to those roles work to accelerate action on climate change in this critical decade. And then of course this year we also have many elections in many countries, but we also have the election in the United States where it's quite possible we'll have Donald Trump return to the White House and he's had particular positions on climate change in the past. Melanie, just bringing you in here, I mean, if we see another President Trump, what do you think that could possibly mean for global climate policy? Yeah, so I think we know last time he backed out of the Paris agreement and it was in his intention to leave the Paris agreement. And obviously if we have another of those attempts that would be quite a wouldn't maybe disastrous, it would be pretty bad for global climate change action considering that the US needs to be on the table for to contribute to, yeah, to contribute to climate change action. And so at the moment that conversation hasn't played out as much yet in the US. So I guess it remains to be seen, but it might be, hopefully not, but might be that we're moving backwards a little bit again. I just want to take us back to, when we're talking about climate and development though, and this is now going some more squarely into both of your areas of expertise, when we're talking about climate and development where the rubber hits the road is really around climate finance. Now I think this year that's going to be one of the key sort of priorities at the next summit. So maybe Melanie, just sticking with you, can you just give us a bit of a basic rundown on where things stand when it comes to climate finance, and what are the big issues right now? Yeah, sure, so one of the big issues is that there is probably not enough money to cover it all and to go around. And one of the numbers that is out there is that we will need about $2.4 trillion a year by 2030 in order to cover the cost of climate change. And one of the biggest issues is actually that there is a concerning gap for adaptation funding, especially in the most vulnerable countries. So we know that the needs are about 10 to 18 times greater than what is currently provided, and that is because mitigation is especially for the private sector much more attractive to invest in because you have a business case. You get your money back and you're making money along the way when you invest into renewable energy. Adaptation on the other hand is purely an investment and without a financial gain usually. The examples where you can have adaptation where you still have a financial gain if you set it up correctly. But in general adaptation needs to come in the form of grants. And this year at the next COP we have something that we call the new collective goal on climate finance and there will be decided on the quantum of climate finance that is required and what developed countries commit to every year. So we used to have $100 billion a year starting from 2009 up till now. And that goal was only met in 2022. Calculations have just come out from the OECD and based on what they've counted as climate finance it looks like if we've or developed countries have met that goal. So one of the problems is that I've just alluded to, what do we count as climate finance? What does actually go into that goal? What can developed countries claim as their contribution of the fair share? And then also what proportion of that goes into adaptation? What proportion of that goes into mitigation? Are we going to include loss and damage in that as well? So these are all things that need to be worked through at the next COP. And then also question is if we haven't reached $100 billion by now, which is sort of now the baseline level, how good is a goal that is even bigger than that if we can't even reach it already right now? So yeah. And one of the, thanks for that Melanie, one of the key ways in which I certainly many countries, especially the richer countries are looking to plug the climate finance gap is through the multilateral development banks or the MDBs, which the World Bank is the big one, but there are others, the Asian Development Bank, the African Development Bank. And basically they are looking to turn these development banks into sort of green development banks. And so I want to bring you in here, Shell, because you've studied a lot of green banks. How do you see what's going on here in terms of trying to transform the MDBs into being green development banks rather than just regular development banks? So thanks, Roland. I think it's a really sort of interesting question and one that's only going to become sort of more prominent as the net zero transition advances. So I mean, most multilateral development banks were founded as institutions that were focused on building economic development and sort of building key pieces of infrastructure within the developing countries. And green banks are quite different types of institutions. So they're usually national level institutions. They can be subnational as well. But they're domestic institutions which look at accelerating investment in particular technologies to help catalyse investment for the net zero transition. And so there are some times where climate and development goals overlap within those institutions, but there are times where those two goals are incongruous. And so I think that there's a lot of work that needs to be done around thinking about how multilateral development banks can be reformed and how their investments can be evaluated so that we're understanding better how they are creating and sort of capturing or destroying value to sort of help accelerate the net zero transition. Yeah, I mean, I think, and you, you know, you alluded to one of the key issues, I think, in this whole debate around climate and development, particularly when we're talking about climate finance, which is the extent to which there's, you know, there is a synergy between you fix the climate crisis, you're fixing the development crisis at the same time. But then there's also the potential for tensions between trade-offs between these two agendas. And I think, particularly when we listen to the, you know, policy makers speak, you know, it's not something that people want to readily acknowledge, right, they want to say that it's all synergy and that there's no trade-off. But we know there's only a limited amount of money to go around. A lot of the climate finance has been coming out of the pre-existing aid budgets. So it's being rebadged or double-dipped or repurposed or cannibalised, depending on how you want to look at it. But there's some kind of tension there. I think it's a really difficult question, actually, is one of those sort of wicked problems. But I just want to bring you both in to sort of say, well, how do you each just think about that? How do you think through what are the synergies and trade-offs when you're confronted with this issue? Maybe we're starting with you, Melanie. Yeah, sure. So like you mentioned, there's an increase in call for really making those synergies happen between climate change action and development aid. So we have the Intergovernmental Panel on Climate Change, the main scientific body of the UNFCCC say that if you do climate change action, you also have an opportunity to address the sustainable development goals and have done a nice analysis within their report. And countries are continuing to acknowledge that. One issue is, like you said, finance could be stripped away from development budget in order to invest more into climate change. And if you create those synergies, in theory, you want to also try and get more bang for your buck, right? You invest into climate change, you do development. You do development. You also create the synergy of doing climate change action. Especially nowadays, with all the geopolitical destabilization of the political economy, we also develop countries face tremendous climate change impacts themselves. We have the war raging in the Ukraine. We have the cost of living crisis. We have the war in Palestine. So the dollars get less and less. So, but at the same time, like you said, it's also not always possible. So there are those tensions. Some countries have development challenges that kind of need to be addressed first. So for example, in India, there's air pollution, there's waste, and there's poverty. So you have a little bit of a trade-off there, whether you want to invest into poverty, alleviation first, or into climate change. And sometimes maybe in such instances where you don't really know what to do or how to do it, thinking about to at least not create perverse outcomes. So increasing the greenhouse gas emissions when you do a project that reduces air pollution in the city, but from a health perspective, not in order to reduce greenhouse gas emissions. And there you can see, you do it at the same time, but the main objective would be to increase people's health and make sure that the air is actually breathable. Rather than desperately trying to combine the two and making sure that you always will have a synergy there, because it doesn't always necessarily make sense. So I think that's something we really have to work through, actually, and ask ourselves, when can we do it, and when can't we do it? On the other hand, if you have climate change, sorry, if you have development projects and you're building a road or you're building a bridge, you need to make sure that this is really climate-proof. So there's no point of building a road if you know sea-level rise will wash it away in five years' time. So you need to still include that climate factor. So something really, yeah, that we have to work through in the next coming years as well. And yeah. No, thanks for that, Millie. I think it's definitely, as you say, there's a strong, there's stronger synergies on the adaptation and development side of things. There's probably more maybe on the mitigation side of things where it does become a bit more complex. But, Shell, I just want to bring you in here. Any thoughts on this question? Yeah, so I mean, I totally agree with you both that there is strong tensions between these goals at times, that they can be incongruent. And to give one example, I was recently in Indonesia and they have a very ambitious development goal to become a high-income country by 2045. And part of their strategy to achieve this goal is to capture some of the value from the new industries needed in the net zero transition and develop lithium battery and domestic EV manufacturing industries. Now, these industries require stable power supply and Indonesia has been establishing coal plants to provide power for some of these manufacturing facilities. And I think it's a clear example of the complexities in managing climate and development goals. And we need policy makers need to ask themselves, how can Indonesia with the help of additional climate finance create these new industries in a way which also allows the world to stay on track to meet its climate goals? And so I guess, you know, I would say that there's two key things that need to happen here. And the first is we need to recognise that climate and development are not the same and they can't use the same amount of funds to deliver double the outcome. So there needs to be an increase in funds. And so the the NCQG process through the UNFCCC is going to be very important this year and other MDB reforms to scale up finance. But then secondly, I think, you know, we really have to a need to evolve our investment governance and evaluation because traditionally governments in the private sector have generally focused on the financial value or financial returns of investments and broader forms of value, such as public goods and co-benefits have not often been systematically evaluated or captured. And the same is true of sort of negative impacts from investments. They often haven't been captured adequately. And I think some of the hydro developments in Southeast Asia are a good example of that. But, you know, part of the challenge of the world that we're currently in is the competing policy priorities that governments are facing with these limited resources to address them. And this ultimately means that governments and policy makers need to become more comfortable with making complex trade-offs and policy decisions. And so there's a real need for new evaluation tools to understand these policy trade-offs more effectively. And we're sort of seeing a range of new tools like sustainable taxonomies, the ISSB standards being developed to try and help manage these risks and uncertainties and trade-offs better. But more definitely needs to be done, in my view. And policy makers and governments do really need better tools to evaluate how value beyond financial value is created and captured and destroyed in the transition. And thanks for that, Shal. I think that's a really many good points, but I think a really great point there. More on the synergy space, I suppose, but sort of making sure you're capturing all of the synergies through better evaluation and a project analysis and all of these kinds of things. So the space for synergy might be bigger than one might think in. And as Melanie said earlier, to avoid the perverse outcomes as well, which is, of course, a good outcome. It's not one for development, from the development perspective, either. But you mentioned Indonesia there, Shal. And so that's good, because it's actually the next area I wanted to bring our conversation. Do you mind if I just jump in? I'm just one more thing to say on that development climate nexus or clash or tension, whatever we want to call it. So I think one important thing, and Shal said that, alluded to that a little bit, is that climate and development are not the same. So it's also not the same people that work on it. So one thing that we might have to look at is that policymakers come together within the government and talk to each other when there are projects, that they're consulting the people that work on climate when there are development people and vice versa. So that's probably just a practical thing that often we think, oh yeah, it's kind of the same, isn't it? You're working in developing countries and you're trying to alleviate poverty, help people adapt to climate change, but they're actually not the same. They're two different hats. Yes, they are similar, but they are different things that you need to take into consideration. That's a really good practical point. Yeah, so I did want to take the conversation to our part of the world. We're sitting in Sydney, Shell's in Canberra, but we're sitting in Australia and our part of the world in the Indo-Pacific. It is the region that we all ourselves focus our work on, but it's also a really good region to talk about when we're talking about climate and development because we do have big dynamic emerging economies in Asia, like Indonesia or Vietnam or India, where they are developing countries. Development's very important, but they're also absolutely critical to the global net-zero transition. They're a source of growing emissions. And then we've also got the Pacific Island countries, which basically contribute nothing, virtually nothing to global emissions, but of course, bear the brunt of all the worst effects of climate change. So maybe just sticking with you, Shell, I mean, if we're talking particularly around Southeast Asia, which is a particular focus of ours, what are the sort of big priorities, what needs to happen, particularly from that kind of climate finance angle, where climate finance can play a role? Yeah, so I think this is a really interesting question role and one that I know you and I are spending a lot of time sort of thinking about deeply at the moment. And Southeast Asia is a really critical region and the Paris Agreement will not succeed in its temperature goals and limiting warming to 1.5 or 2 degrees if Southeast Asia does not succeed on its net-zero transition. And towards the end of last year, the International Energy Agency released some really sobering data, which examined how much renewable energy was expected to be installed in various countries and regions over the next five years. And this received quite a bit of media attention because China is expected to install over 2,000 gigawatts of renewable energy capacity. But really, I think the most important story in that data was that ASEAN countries are significantly off-track at present and their forecast to only install 63.1 gigawatts of wind and solar, which is well below the 229 gigawatts that they need to keep the net-zero targets underpinning the Paris Agreement alive. So, the key question I think here is why are ASEAN countries off-track? Their economic growth has been really impressive. And this is something that we've been looking at quite a bit at the Lowy Institute. And ASEAN countries really face a dual challenge because they need to decarbonise their existing electricity supply whilst also building additional new capacity to sort of deal with their strong forecast electricity growth. And there's a really complex range of barriers to scaling up renewable energy, storage and transmission investments in Southeast Asia. And these include that many of the markets in these countries are sort of run by state-owned entities and are not competitive. There are a lot of them that are heavily subsidised. Some of them have access electricity capacity. Some have stringent local content requirements. And many have significant electricity planning coordination issues. And all of these things discourage investments and need to be kind of straightened out in order to have the investment dollars flow. And then on top of that, even when you sort of have the right regulatory and policy settings for investment, there's a huge skills challenge in sort of making sure you have all of the electricians ready to string wires onto transmission poles and to build the renewable energy installations that are needed and the storage. And so I think at this point, this very critical moment in the net zero transition, it's really something that all ASEAN countries and all ASEAN allies need to be sort of laser focused on. And everybody needs to be trying to help ASEAN sort of make sure that this transition is scaled up at the same time that Australia and the US and other Indo-Pacific allies are also focused on their own transitions because this IEA data does show that we have a significant problem with that sort of investment transition and net zero transition at the moment. Yeah, I think that's a really interesting point as well that you make, Shell, because one of the things you're pointing out along the way there is that in many ways, we just said earlier, all three of us, about the need for more climate finance, but there's an issue also on the absorptive capacity side of countries on the other end of this. In this case, Southeast Asia, where it's not so straightforward just to pump money in and to get more investment and therefore reductions in emissions, we know that also, I mean, Southeast Asia is important also because it's actually been on the receiving end of these big new just energy transition partnership deals or JETPs, I think 20, I get the numbers right, 20 billion in Indonesia and 12 billion also commitment for Vietnam. So these are quite big, they're quite exciting in a sense because it's the international community, principally the G7 really stepping up with some big emerging economies to finance the clean energy and transition and put some money on the table, not much in the way of grants, but loans and blended finance from the private sector and these kinds of things. I mean, just very quickly, Shell, I mean, how do you see that going? Do you see that as promising? I know there's been some issues along the way, but what do you think about these JETPs? Absolutely, I think they're promising and yes, there are sort of complex issues in setting them up and making sure the money flows, but I think they're a really critical part of a successful net zero transition in ASEAN and I really hope that they continue to be sort of utilized as one of the sort of key tools in the transition in the region because without that additional investment from G7 countries, it's gonna be very, very challenging for the ASEAN region to meet their net zero goals. Okay, so switching from these big emerging economies now to the Pacific Islands, we also do a lot of work on the Pacific. Melanie, that's a real focus of yours, the most vulnerable countries when it comes to many things, but the impacts of climate change. So aid is also a big deal in the Pacific as well. So what are the big issues and priorities right now from that climate and development, but also that climate finance perspective? Yeah, absolutely. So one of the highest priorities for the Pacific is really climate change adaptation and making sure that countries are resilient and resilient to shocks, especially extreme weather events, but then also slow onset events such as sea level rise. We've already talked about that, but also an interesting one for the Pacific is salinization where the soil becomes too saline and crops can't grow. So these are circumstances that the Pacific really needs to adapt to because even if they, like you mentioned, reduce all their greenhouse gas emissions to zero, the trajectory, the global trajectory of reaching our 1.5, it wouldn't change. We're currently on a trajectory to almost, I think 2.3 degrees Celsius increase in global average warming and if the Pacific got to net zero, that wouldn't change any of that trajectory. So all they can do is adapt to the impacts that are already happening. And obviously that means that they wouldn't need grants and even if they do mitigation projects, these projects would be energy security and creating resilience rather than reduction of greenhouse gas emissions in order to achieve our goal. So there's the difference between Southeast Asia and the Pacific here. And what the Pacific needs, I guess, from the global community is deep emissions cuts from global actors. And I think Australia can really back this up here and action accordingly, advocate for the Pacific but also look into their own domestic policies. I do think that the climate change component in that development strategy is a good move and acknowledges that then more needs to be happened as part of the development aid but also it needs to continue through bilateral funds with the Pacific as well as Australia. Yeah. Yeah, you bring Australia in and I suppose it's hard not to given Australia is the main sort of rich country and power in the region and the biggest donor. But Australia has a role to play in terms of the global net zero transition in terms of supporting Southeast Asians, in terms of supporting the Pacific. So Australia is a rich country and a high per capita emitting country as well and a fossil fuel exporter. So a lot of things that suggests a high level of responsibility. At the same time, as you say, there's action domestically on climate policy but there's also a new development strategy from Australia which prioritizes climate change. So just maybe very quickly, what are your sort of thoughts from each of you I'd like to hear about what's Australia's role and in all of this, what are a couple of things that we need to focus on? Maybe starting with you, Melanie. Yeah, sure. So one thing is that Australia needs to maintain, I believe in that strongly, remain their global credibility as a climate change player which they have started to improve over especially last year at COP28. So it needs to remain credible within the rich countries like you said, providing their fair share of climate change finance, for example. But then also balance the interests of the Pacific who welcome those bilateral funds as they are easier to access for them rather than the Green Climate Fund and those multilateral funds that are out there. And I think one thing that I also wanted to mention earlier is that Australia also has a really good opportunity with COP31, Australia is hosting, hopefully co-hosting COP31 with the Pacific. So there's a bid that's on the table and Australia wants to do that. Australia really has an opportunity there to advocate for those specific issues, to advocate for adaptation and to ensure that the fossil fuel language that Shell talked about gets stronger and stronger and that maybe at one point we actually get to a phase out rather than transitioning out out of fossil fuels. So that can be Australia's role domestically or regionally. And Shell, anything from you as well? I know you've also spent a lot of time working on Australian climate policy. So the idea of a COP31 potentially being co-hosted from Australia must sound very exciting to you at the very least. Yeah, it's exciting and I think it's probably also quite a daunting challenge in some ways. It would be the largest diplomatic event that we've ever hosted. So it would be a really big challenge to sort of pull it all together in the next couple of years, but an extremely rewarding one that I think Australia and the Pacific would be able to do sort of an excellent job in managing. And so, I mean, I think that I would absolutely agree with Melanie that Australia has a very important role to play on the international stage. For all the reasons you mentioned, Roland, we are a wealthy country. We are a fossil fuel exporter. We do have hyper-capita emissions. So if Australia is working really hard to accelerate its transition and being a positive actor on the world stage, it really sets an example to other countries around our region and around the world to sort of step up as well. And it increases pressure on those who don't. And I think we really saw that at COP recently when Minister Bowen was very sort of firm in some of his language around supporting stronger action around a range of different measures, including the fossil fuel text. And I think that that's something that will hopefully kind of continue as you look to host and have that the bid for COP finalised. And I think the other really sort of exciting area that Australia can play a significant role going forward is building upon the very strong work that we have done traditionally in the measurement reporting and verification space because if you're not actually accounting for emissions properly, then the whole kind of basis of the net zero transition is not on firm ground. And Australia has been very constructive over the years in helping to support development of agriculture, emissions accounting, of methane, of blue carbon accounting. And so I think we have a real role in sort of continuing to try and develop best practice for emissions accounting and for constantly helping to update our own systems and helping to set those international best benchmarks for best practice. So that would be another sort of more technical area that one where I think we can actually play an important role going forward. Thank you for that, Melanie. Did you? Yeah, I just want to jump in on the COP 28 and the language that Minister Bowen used. I was quite pleased to hear his final remarks or some of his final remarks at the closing plenary. And I think it came through from a lot of wealthy or rich countries, including the US, Germany and Australia that they would have hoped for stronger language on the fossil fuel transition phase out, phase down. So they would have liked to see stronger language there. And I found it was quite refreshing to see that Australia was back on the table with that. So and then when we look at COP 31 with our elections coming up next year, no matter which government will be in power, Australia has to deliver because we're co-hosting it with the Pacific. So, yeah. Yeah, so it's a bit of a positive sort of outlook, I suppose, or another way of putting it, the pressure would definitely be on for Australia if we win this bid. Now, one of the things that both of you know, we're sort of coming to either the funnest or hardest part of the podcast is, you both know we like to end our podcast with a final question to our expert guests where we ask you to put forward your own big ideas about what the world or what Australia or whatever should do in order to address the issues that we've all been talking about during the episode. So that's climate change, that's climate finance, that's climate and development. So maybe starting with you, Shell, I mean, what are your sort of some big ideas you'd like to put on the table in terms of how the world and we all could do better? Well, I think from the discussion that we've had, Roland, it's pretty clear that there is a significant gap in the level of climate finance that's required to meet the goal of Paris and the current levels that we're seeing that are being dispersed. And even with ambitious multilateral development bank reform, there's still going to be a sizable gap. So for me, the question is, what do we need to do at the multilateral and the national levels to try and fill this gap? And so I've got a couple of different solutions that we're working on in the work that we're doing at Lowy. So first, the multilateral development banks that were born out of Bretton Woods are not really designed specifically to deal with the modern challenges that we're facing. And so there's a real need for a new form of multilateral bank that more effectively meets climate and development objectives, which is the focus of a report that you, I and another colleague, Grace Danhope, are writing. And our solution is really to take the strongest elements of MDBs, of export finance agencies and of green banks like Australia's Clean Energy Finance Corporation, and to use those to create a new form of multilateral development bank that sits under the Indo-Pacific Economic Framework. And in doing so, you'd have a bank that geographically sits at the heart of the net zero transition that puts rising powers like India and Indonesia at the heart of its governance and that leverages public finance in a very efficient and effective way to shape the rate and the direction of the clean energy transition. So stay tuned for our report on what an IPF bank could look like and could achieve. But I do think that that is a really key piece of the puzzle in the multilateral climate finance landscape. And then secondly, at the national level, there's a huge need to accelerate clean energy industries in ASEAN as we've spoken about. And I think an important part of the solution is to look at their current institutions and to look at the role of green banks as an institutional tool in Southeast Asian countries. So green banks provide equity financing for the net zero transition and finance projects that are commercially viable but can't source private finance because either the investment is first of a kind in that the country that it's being deployed in or the financial structure of the transaction needs to be innovative and the transaction costs associated with developing that structure are too expensive for commercial banks to take on that takes its two-time consuming. But the CFC, Australia's green bank has been very successful in financing a range of innovative technologies and investments and to really catalyze the clean energy transition in key segments like large-scale solar and offshore wind or sorry, and onshore wind. And while not all of their lessons from Australia's green bank experience are transferable to Southeast Asia, many of those lessons are. And so I really hope that we look at scaling up our expertise in terms of sharing knowledge about green bank governance and functions to help more of our neighbors in Southeast Asia over the coming years. Thank you, Shell, and maybe final word to you, Melanie. What are your big ideas? So one of my big ideas is related to the loss and damage fund surprise. So I would like to, or what I'm trying to sometimes think about is how can that fund be set up properly and that it's working for the most vulnerable countries. And I think one promising blueprint and maybe people don't really look into that a lot is the European Solidarity Fund. I think it has some really good characteristics that we could use in order to further shape the loss and damage fund. For example, it would overcome some of the challenges. For example, how much money do you get in the case of an extreme weather event? So the European Solidarity Fund doesn't cover all of the costs that are associated with the loss and damage caused by a flood, for example, because they, or the fund acknowledges that there's certain responsibility of the country themselves, but also not all of the losses and damages are caused by climate change because there are always cyclones in the Pacific or in the Caribbean, for example. So that would overcome some of those challenges of attribution. There's also flexibility on how countries can spend that money, they can spend it on non-economic losses, for example. And obviously not everything would work, but some of the features I think would be worth looking at and I would also like to see another discussion on whether the Green Climate Fund might not be something that is more suitable to host a loss and damage sort of facility fund or whatever you want to call it in the future and re-evaluating that once the host, the World Bank as the host comes to it and after the four years. I mean, it can work, it would be great if it does, but if not, that's maybe something we should, again, look into. And the other thing is, we've already discussed and Shell said it is all fine and this is an obvious problem, development in climate in any of the, and all of the above. And there's the constant call for innovative funding solutions and engaging the private sector. And so sometimes I wonder, so what is innovative finance solution? And we need to look into philanthropies and so I've been thinking about that and I think if we, and we need more grants and when we talk about the private sector, it's often about, like you mentioned Shell, it's the banks, it's investment, but what about if we tap into really those philanthropists, that innovative finance source to provide grants to create a strategic funding stream for multilateral funds made before the Green Climate Fund, the Adaptation Fund, the Loss and Damage Fund, maybe they can even have it direct access through regional or country organisations, but they are providing grants and strategically making use of that money because a lot of money, a lot of that money is spent, but it's not strategically spent and with the purpose. So what if we create a pool of philanthropists that then can funnel some of that funding towards climate change action, so yeah. That's very good. Thank you for that Melanie and Shell. I mean, very specific, practical, pragmatic, policy-orientated suggestions, which is exactly what we like to specialise in here. So that's really good and fantastic discussions. I hope our listeners got a lot out of that, but we'll have to leave the conversation here. So thank you both for joining me on this podcast. You've been listening to Development Futures, a podcast from the Indo-Pacific Development Centre at the Lowey Institute, hosted by Institute experts, produced by my colleague Josh Goding and supported by the Australian Department of Foreign Affairs and Trade. Development Futures is part of the Lowey Institute podcast network. Find all our podcast series on our website. Thanks for listening.