Commercial diplomacy is

diplomacy Diplomacy comprises spoken or written communication by representatives of states (such as leaders and diplomats) intended to influence events in the international system.Ronald Peter Barston, ''Modern diplomacy'', Pearson Education, 2006, p. ...

that focuses on development of business between two countries.Naray, O. (2008). "Commercial Diplomacy: A Conceptual Overview." Conference paper for the 7th World Conference of TPOs – The Hague, The Netherlands. It aims at generating commercial gains in the form of trade and inward and outward investment by means of business and entrepreneurship promotion and facilitation activities in the host country. Commercial diplomacy is pursued with the goal of gaining economic stability, welfare, or competitive advantage.Reuvers, S. and Ruel, H. J. M., "Research on Commercial Diplomacy: Review and Implications" in ''Commercial Diplomacy and International Business: a conceptual and empirical exploration'', Ruel, H. J. M., ed. (Advanced series in Management, Emerald, 2012). As a term, commercial diplomacy emerged in the second half of the twentieth century (e.g., Joseph, 1965; Corbet, 1972), but the concept certainly existed in previous centuries. In literature the concepts of

economic diplomacy Economic diplomacy is a form of diplomacy that uses the full spectrum of economic tools of a state to achieve its national interests. The scope of economic diplomacy can encompass all of the international economic activities of a state, including, ...

and commercial diplomacy are often used interchangeably. Definitions of both concepts vary, and consequently the relationship between them is also described differently. Some authors argue that commercial diplomacy is a subset of economic diplomacy. It is certain, however, that both kinds of diplomacy are "irrevocably intertwined" and thus "distinct utobviously closely related to ach other.

Purpose

Commercial diplomacy emphasizes the government's role, being defined as "a government service to the business community, which aims at the development of socially beneficial international business ventures". It is "the work of diplomatic missions in support of the home country's business and finance sectors and includes the promotion of inward and outward investment, as well as trade". Commercial diplomacy thus includes "all aspects of business support and promotion" including investment,

tourism Tourism is travel for pleasure or business; also the theory and practice of touring, the business of attracting, accommodating, and entertaining tourists, and the business of operating tours. The World Tourism Organization defines tourism mor ...

, R&D, and

intellectual property Intellectual property (IP) is a category of property that includes intangible creations of the human intellect. There are many types of intellectual property, and some countries recognize more than others. The best-known types are patents, cop ...

. Commercial diplomacy is designed to influence foreign government policy and regulatory decisions that affect global trade, investment and commerce. It is concerned with government regulations and actions that affect international commerce—including standards in areas such as health, safety, the environment, and consumer protection; regulations covering services such as banking,

telecommunications Telecommunication is the transmission of information by various types of technologies over wire, radio, optical, or other electromagnetic systems. It has its origin in the desire of humans for communication over a distance greater than that fe ...

and accounting; competition policy and laws concerning bribery and corruption; agricultural support programs; and industrial subsidies. Potter (2004) argues that commercial diplomacy is a value-creating activity due to its usefulness in dealing with managerial and government concerns. In this context, commercial diplomacy is profitable in that it makes exporting and operating abroad easier; it is a valuable instrument for export promotion and operating abroad; it enables companies to perform tasks abroad more quickly and increases the amount of exports and company results by providing information about rules, regulations, culture, public tenders and the market of the host country; by providing support during the partner search; and by providing assistance in trade disputes, fairs, and missions. Especially for companies that have financial limitations, access to reliable information and a broad network abroad are essential.Potter, E. H. (2004). "Branding Canada: The Renaissance of Canada's Commercial Diplomacy", ''International Studies Perspectives'', 5, 55-60.

Activities

Traditional commercial diplomacy activities include facilitating, negotiating, promoting and arbitrating international trade, investment, intellectual property and commerce, and advocating Responsible Commercial Diplomacy (RCD), together with networking, capacity building, intelligence, image campaigns and support. These activities are shown in the table below. Other activities for commercial diplomacy and rationales that companies need are: need for access to reliable and neutral business information; credibility and image support in foreign markets; partner search; conflict handling; support of home country delegations (state missions); strategic concerns (e.g., energy).Kostecki, M., and Naray, O. (2007). ''Commercial Diplomacy and international business'' (Den Haag: Nederlands Instituut voor Internationale Betrekkingen Clingendael, April 2007): p. 41.

Purpose

Activities

See also

References

Further reading