On Friday, the last round of UN Climate talks petered to a close. Officials had made predictable progress on the negotiating text and it is now a 300 plus page document with all the options on the table. However, at this stage there is insufficient progress on the politics or on the content of major parts of an ambitious Copenhagen agreement.

From here the key next major meeting will be the Major Economies Forum in July. If we are going to improve the content or ambition of the Copenhagen agreement, world leaders — including the Prime Minister — will need to step up, begin to break some political deadlocks and inject some momentum into the UN talks.

For Australia, this meeting just finished represented an important junction in its climate change diplomacy. For the nearly 20 year history of the climate talks Australia’s climate diplomacy has been monopolised by narrow concerns about the impact of global or domestic action on our coal and energy intensive industries.

In the halls of UN meetings and elsewhere many have recently begun to notice a subtle change. Australian climate diplomacy is being described as “constructive” and appears to be slowly but surely being infused with a new perception of the national interest.

This new definition of the national interest has been driven by Professor Garnaut’s Review, broader economic opportunities and the evolving science and persistent drought in many parts of the country. In December, the Government accepted Professor Garnaut’s recommendation that it would be in Australia’s interests to stabilise greenhouse concentrations at 450 ppm-e or lower. The Coalition now appears to back this view of the national interest.

Additionally, national security agencies have been considering implications of major climate change events and impacts on our near neighbours. The recent Defence White Paper identified climate change as new security threat and suggested that the best defense against such developments will “need to be undertaken through coordinated international climate change mitigation and economic assistance strategies.” It goes on to suggest that should these policies fail “the Government would possibly have to use the ADF (Australian Defence Force) as an instrument to deal with any threats inimical to our interests.”

However, Australia’s foreign policy potential on climate change is yet to be fully realised.

Like other countries, Australia has put on the table targets that are conditional on international action. For the 25 percent reduction on 2000 levels by 2020 target conditions set are tough but are consistent with the country’s national interest goals.

Australia has also put forward innovative, but potentially divisive, proposals on the legal form of the new post 2012 agreement. From the perspective of some developing countries this proposal is confronting. Without going into detail, the structure proposed by Australia starts to break down the firewall that differentiates the kinds of obligations the developed world and developing world should undertake. (Developed countries as a group are lining up to play chicken with the developing world on this issue.)

Regardless of the proposal it is putting forward, Australia’s fundamental Achilles’ heel in the climate talks is its failure to deliver a clear and fleshed out policy position in international financing and technology transfer and deployment.

Australian conditions for a 25% reduction commitment require substantial commitments and actions from developing countries. It was agreed in Bali, by Australia and others, that this would be supported by financing and technology transfer from developed countries. The conditions outlined by Australia cannot be met — either politically or practically — without a substantial, measurable, reportable and verifiable financial and technology package in the post-2012 climate agreement. This package must unlock trillions of dollars of new public and private investment in smart and clean energy solutions, facilitate low carbon strategies, accelerate technological innovation pathways and support adaptation to the impacts of climate change in developing countries.

Without concrete proposals on how to deliver commitments on financing and technology, Australia risks being damaged politically both domestically and internationally, and undermining the national interest.

Failure to deliver on financing and technology will reduce the chances of achieving the emissions reductions Australia needs to protect itself from dangerous climate change. Failure to deliver on finance and technology will close opportunities for Australia’s low carbon industries to expand export markets and will stunt new low carbon industrial job growth.

Success however would present diplomatic and economic opportunities that have not been fully realised in Australia and protect the national interest for today and tomorrow.

Erwin Jackson is the Director of Policy and Research at the Climate Institute and was an observer at UN climate change talks in Bonn. Mr Jackson is speaking in Melbourne alongside Professor Ross Garnaut on Friday (June 19) about the prospects of an ambitious global deal.