thesis on economic diplomacy

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Economic Diplomacy: Concept and Practice in Vietnam - U.S. relations.

Phan, Phuc L.

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• Fletcher School of Law and Diplomacy Scholarship
• Theses and Dissertations
• Fletcher School of Law and Diplomacy.
• Master's
• Diplomacy--Economic aspects.
• International economic relations.
• United States--Foreign relations--Vietnam.
• Vietnam--Foreign relations--United States.
• United States--Foreign economic relations--Vietnam.
• Vietnam--Foreign economic relations--United States.
• Academic theses.
• Tufts dissertations and theses.
• http://hdl.handle.net/10427/000240

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Dissertations / Theses on the topic 'Economic diplomacy'

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Azrieli, Naomi. "Soviet economic diplomacy, 1941-1947." Thesis, University of Oxford, 2000. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.324974.

Mota, Maria Dulce de Oliveira. "Diplomacia portuguesa no mundo globalizado - Mudanças e continuidades." Master's thesis, Universidade de Évora, 2020. http://hdl.handle.net/10174/28726.

Omelyanenko, V., and V. Skoryk. "Economic diplomacy in Ukraine: state and tasks." Thesis, Sumy State University, 2017. http://essuir.sumdu.edu.ua/handle/123456789/64986.

Soeya, Yoshihide. "Japan's economic diplomacy with China, 1945-1978." Oxford : New York : Clarendon Press ; Oxford University Press, 1998. http://www.loc.gov/catdir/enhancements/fy0606/99219973-t.html.

Šolcová, Lenka. "Ekonomická diplomacie Německa v České republice." Master's thesis, Vysoká škola ekonomická v Praze, 2010. http://www.nusl.cz/ntk/nusl-85836.

Mlaba, Lindokuhle Hendrick. "The impact of South Africa's economic diplomacy on Africa's development." Thesis, Nelson Mandela Metropolitan University, 2016. http://hdl.handle.net/10948/11531.

Lopes, Ana Filipa Vale. "A diplomacia portuguesa como um instrumento de renovação da credibilidade e prestígio externos durante e pós-crise." Master's thesis, Instituto Superior de Ciências Sociais e Políticas, 2017. http://hdl.handle.net/10400.5/14976.

Zhang, Shuxiu. "The dragonomic diplomacy (De)code : a study on the causal relationship between Chinese economic diplomacy preference formation and the influence of multilateral economic regimes." Thesis, London School of Economics and Political Science (University of London), 2013. http://etheses.lse.ac.uk/747/.

Joaquim, Cláudia Claro. "A Diplomacia Económica Portuguesa e a Internacionalização da Banca : Estudo de Caso." Master's thesis, Instituto Superior de Economia e Gestão, 2011. http://hdl.handle.net/10400.5/4397.

Norman, Nicholas Wise. "Swinging the club : relations between the United States and the British Commonwealth in the economic transition from war to peace, 1943-1948." Thesis, London School of Economics and Political Science (University of London), 1994. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.282957.

Alves, Ana Cristina. "China’s oil diplomacy : comparing Chinese economic statecraft in Angola and Brazil." Thesis, London School of Economics and Political Science (University of London), 2011. http://etheses.lse.ac.uk/206/.

Šorna, Jan. "Role centrál cestovního ruchu v ekonomické diplomacii." Master's thesis, Vysoká škola ekonomická v Praze, 2016. http://www.nusl.cz/ntk/nusl-262250.

Krčál, Adam. "Ekonomická diplomacie v novém tisíciletí a implikace pro ČR." Doctoral thesis, Vysoká škola ekonomická v Praze, 2010. http://www.nusl.cz/ntk/nusl-199594.

Legrenzi, Matteo. "The gulf cooperation council : Diplomacy, security and economic coordination in the gulf." Thesis, University of Oxford, 2008. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.530048.

Chantre, Zenaida Vieira Brito. "Cabo Verde:a nova diplomacia económica." Master's thesis, Instituto Superior de Ciências Sociais e Políticas, 2020. http://hdl.handle.net/10400.5/19820.

Jařinová, Zuzana. "Systémový pohled na ekonomickou diplomacii v podmínkách České republiky." Master's thesis, Vysoká škola ekonomická v Praze, 2007. http://www.nusl.cz/ntk/nusl-15527.

Valsamakis, Antoinette. "The role of South African business in South Africa’s post apartheid economic diplomacy." Thesis, University of Birmingham, 2012. http://etheses.bham.ac.uk//id/eprint/3391/.

Leso, Malesela William. "Economic Diplomacy through International Tourism Co-operation : the Case of South Africa and China, 2009 to 2017." Diss., University of Pretoria, 2017. http://hdl.handle.net/2263/63876.

Semrádová, Lenka. "Ekonomická diplomacie České republiky ve Francii." Master's thesis, Vysoká škola ekonomická v Praze, 2015. http://www.nusl.cz/ntk/nusl-206334.

Dus, Jakub. "Ekonomická diplomacie Číny v Africe." Master's thesis, Vysoká škola ekonomická v Praze, 2013. http://www.nusl.cz/ntk/nusl-264517.

Santos, Benilde Andreia Ferreira dos. "A diplomacia económica em países exportadores de petróleo - análise dos casos de Angola, Venezuela e Líbia." Master's thesis, Instituto Superior de Economia e Gestão, 2010. http://hdl.handle.net/10400.5/2924.

Kudzejová, Barbora. "Ľudské práva a ekonomická diplomacia – prípadová štúdia WTO." Master's thesis, Vysoká škola ekonomická v Praze, 2015. http://www.nusl.cz/ntk/nusl-206439.

Mitcham, Chad James. "Trade, grain and diplomacy in China's economic relations with the West and Japan, 1957-1963." Thesis, SOAS, University of London, 2000. http://eprints.soas.ac.uk/29011/.

Čižmárová, Lucia. "Ekonomická diplomacia Číny v Afrike." Master's thesis, Vysoká škola ekonomická v Praze, 2011. http://www.nusl.cz/ntk/nusl-136331.

Kaucká, Kristýna. "Česká ekonomická diplomacie v zemích BRICS." Master's thesis, Vysoká škola ekonomická v Praze, 2012. http://www.nusl.cz/ntk/nusl-142086.

Antonínová, Markéta. "Současná ekonomická diplomacie Číny a Indie v Africe." Master's thesis, Vysoká škola ekonomická v Praze, 2015. http://www.nusl.cz/ntk/nusl-262002.

Ampiah, Kweku. "Japanese foreign policy towards sub-Saharan Africa, 1974-1990 : the dynamics of an immobilist economic diplomacy." Thesis, University of Oxford, 1993. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.386488.

Chervets, Tamara. "Ekonomická diplomacie Číny v Latinské Americe." Master's thesis, Vysoká škola ekonomická v Praze, 2011. http://www.nusl.cz/ntk/nusl-113606.

Brown, Lisa Carrin. ""Soft power efforts, hard power gains" : India's economic diplomacy towards Africa using Nigeria and Kenya as examples." Master's thesis, University of Cape Town, 2016. http://hdl.handle.net/11427/20639.

Svoboda, Ondřej. "Ekonomická diplomacie ČR vůči Spojeným státům mexickým." Master's thesis, Vysoká škola ekonomická v Praze, 2014. http://www.nusl.cz/ntk/nusl-206480.

Van, Zyl Stefan Daniel. "The diplomacy of multinational corporations (MNCs) : bargaining with developing states." Thesis, Stellenbosch : Stellenbosch University, 2004. http://hdl.handle.net/10019.1/50137.

Carlsson, Martin. "Svenska handelsmöjligheter med Kina : Staten och näringslivets etablerande av handelsrelationer med Kina ur ett ekonomiskt diplomati-perspektiv, 1949–1964." Thesis, Uppsala universitet, Ekonomisk-historiska institutionen, 2018. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-355597.

Šmahelová, Kateřina. "Nation branding jako prvek ekonomické diplomacie - španělská praxe." Master's thesis, Vysoká škola ekonomická v Praze, 2014. http://www.nusl.cz/ntk/nusl-203895.

Xu, Jiajun. "Buying influence? : the international diplomacy behind donor financing of the World Bank's International Development Association." Thesis, University of Oxford, 2015. http://ora.ox.ac.uk/objects/uuid:4e90a729-0a79-457a-9497-b35defeae456.

Oliveira, Mariana Sandoval de. "O processo de internacionalização de empresas da China: estratégias empresariais e diplomacia econômica." Pontifícia Universidade Católica de São Paulo, 2013. https://tede2.pucsp.br/handle/handle/9221.

Bukaty, Ryan Michael. "Commercial Diplomacy: The Berlin-Baghdad Railway and Its Peaceful Effects on Pre-World War I Anglo-German Relations." Thesis, University of North Texas, 2016. https://digital.library.unt.edu/ark:/67531/metadc849612/.

Stehlíková, Libuše. "Ekonomická diplomacie jako nástroj v bilaterálních vztazích - případová studie Tchaj-wan." Master's thesis, Vysoká škola ekonomická v Praze, 2009. http://www.nusl.cz/ntk/nusl-77397.

Cone, Cornelia. "An analysis of the economic dimension of the conflict in the Democratic Republic of Congo with recommendations for track one diplomacy." Diss., Pretoria : [s.n.], 2007. http://upetd.up.ac.za/thesis/available/etd-04292008-140416.

Langová, Kateřina. "Ekonomická diplomacie Číny v Africe." Master's thesis, Vysoká škola ekonomická v Praze, 2011. http://www.nusl.cz/ntk/nusl-124900.

Portešová, Veronika. "Ekonomická paradiplomacie - činnosti českých krajů v oblasti zahraničních investic." Master's thesis, Vysoká škola ekonomická v Praze, 2017. http://www.nusl.cz/ntk/nusl-358927.

Dobrovolná, Adéla. "Analýza aktivit agentury Czech Trade na vybraných trzích." Master's thesis, Vysoká škola ekonomická v Praze, 2010. http://www.nusl.cz/ntk/nusl-72200.

Cavlak, Iuri [UNESP]. "Diplomacia, integração e desenvolvimento: Brasil e Argentina (1950-1962)." Universidade Estadual Paulista (UNESP), 2010. http://hdl.handle.net/11449/103148.

Kupstaitytė, Brigita. "Saugumo užtikrinimas ekonominės diplomatijos priemonėmis: Kinijos, Indijos ir Pietų Korėjos lyginamoji analizė." Master's thesis, Lithuanian Academic Libraries Network (LABT), 2014. http://vddb.library.lt/obj/LT-eLABa-0001:E.02~2014~D_20140620_105239-13767.

Mason, Robert. "Economic factors in Middle East foreign policies : the case of oil and gas exporters with special reference to Saudi Arabia and Iran." Thesis, University of Exeter, 2012. http://hdl.handle.net/10036/3838.

Faltusová, Ludmila. "Česká ekonomická diplomacie jako podpora exportu do Německa." Master's thesis, Vysoká škola ekonomická v Praze, 2013. http://www.nusl.cz/ntk/nusl-193022.

Sousa, Jaime Pereira de. "Economic diplomacy: a critical analysis." Master's thesis, 2019. http://hdl.handle.net/10071/18985.

Zu, Wu-ming, and 吳明儒. "Beijing’s Economic Diplomacy towards the Blair." Thesis, 2007. http://ndltd.ncl.edu.tw/handle/07853773994764539706.

何秉澔. "A study on Hu Jintao's economic diplomacy." Thesis, 2007. http://ndltd.ncl.edu.tw/handle/13741083720910191686.

Weekes, Mikhail Ausburne Alistir Sunil, and 韋克斯. "Economic Diplomacy of St. Vincent and Taiwan." Thesis, 2018. http://ndltd.ncl.edu.tw/handle/q9zj4w.

Li, Yang. "China’s Free Trade Agreement diplomacy." Thesis, 2015. http://hdl.handle.net/2440/103486.

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8 Ethiopia’s ‘Economic Diplomacy’ and Regional Integration

Fantu Cheru is emeritus professor of international relations, American University, Washington, DC and a senior researcher at the African Studies Centre, Leiden University, the Netherlands. Between 1998 and 2001, Professor Cheru was the UN special rapporteur on foreign debt for the Human Rights Commission in Geneva. He was associate senior fellow at the Stockholm International Peace Research Institute (Sweden), and the North-South Institute (Ottawa, Canada). From 2007 to 2012, Cheru was research director at the Nordic Africa Institute in Uppsala, Sweden. Professor Cheru was a member of UN Secretary-General Kofi Annan’s Panel on Mobilizing International Support for the New Partnership for African Development (2005–7) as well as convener of the Global Economic Agenda Track of the Helsinki Process on Globalization and Democracy (Finland). Professor Cheru has served as both adviser and consultant to many governments and donor institutions and is on the editorial board of several scholarly journals.

Zinabu Samaro Rekiso is a PhD candidate in innovation and technology governance at Ragnar Nurkse School of Innovation and Governance, Tallinn University of Technology (Estonia). His research interests include late development, industrialization, structural transformation, and economic integration. He currently works for UNHABITAT as a research and M&E consultant. Previously he has consulted for international organizations including UNCTAD, ITC, COMESA, and several international NGOs.

• Published: 11 February 2019
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Sixteen years ago the government of Ethiopia adopted the 2002 Foreign Affairs and National Security Policy, which emphasized ‘economic diplomacy’ as the cornerstone of its foreign policy. A central component of the strategy has been regional integration with Ethiopia’s neighbours in the Horn and Eastern Africa. Since then the political contexts have changed dramatically. Ethiopia is now seen as an attractive destination for labour-intensive manufacturing and the government continues to invest in mega infrastructure and power generation projects to drive its industrial ambition. However, the Ethiopian state faces a storm of internal and external threats that could undermine its ambitious programme of economic transformation and regional integration. This chapter assesses the extent to which the emphasis on ‘economic diplomacy’ has helped the government achieve its goals of economic development, regional integration, and peace and stability in a region where state weakness, poor governance, and vulnerability to external pressures are endemic.

8.1 Introduction

Until the early 1990s, weakened statehood, endemic poverty, and contested borders all negatively affected the capacity of successive Ethiopian regimes to engage the outside world strategically to advance Ethiopia’s national interests. Specifically, the country’s neighbours in the Horn of Africa were viewed with great suspicion and as a threat to Ethiopia’s integrity. With the coming to power of the Ethiopian People’s Revolutionary Democratic Front (EPRDF) in 1991, however, the determinants and decision-making processes behind Ethiopia’s foreign and economic policy changed dramatically, largely due to the changing political economy context at both domestic and global levels.

While the foreign policies of previous Ethiopian regimes were based on a ‘siege mentality’ and were exclusively focused on external threats to the detriment of domestic ones, the EPRDF, by contrast, identified ‘poverty and undemocratic rule’ as the greatest threats to Ethiopia’s national security (FDRE 2002 ). The EPRDF sought to address these twin threats by embarking on a highly political state-building project aimed at transforming the economy and democratizing Ethiopia’s political order. It adopted a new constitution in 1995 that granted—at least on paper—the right to self-determination to Ethiopia’s 90-plus nations and nationalities (MoFED 1993 ; Vaughan 2015 ; FDRE Constitution 1995).

In terms of its foreign policy, the EPRDF-led government gave primacy to ‘economic diplomacy’ aimed at attracting foreign direct investment and external aid inflows to realize its radical economic transformation agenda (FDRE 2002 ; Tewelde and Prasad 2015 ). Indeed, Ethiopia since 2001 has emerged as one of the ‘super-powers’ of Africa—playing an important role in global and regional affairs and positioning itself as the best investment destination in Africa (Verhoeven 2015 ). The EPRDF has presided over an economy that has displayed double-digit GDP growth rates for more than a decade. The economic growth has largely been pro-poor, lifting millions of people out of poverty. The number of households with improved living standards as measured by electricity, piped water, and infrastructure doubled from 2000 to 2011 (MoFED 2013 ).

The EPRDF has also succeeded in providing unprecedented security and administrative control of the state’s population and territory while playing a critical role in regional peace and security in the Horn of Africa. Economic growth and political stability have in turn increased Ethiopia’s appeal as a political ally and economic partner to both emerging partners, such as China, Turkey, and India, and traditional Western development partners (Cheru 2016 ). In 2015, for example, Ethiopia received US$3.2 billion in investment from the total US$7.8 billion received by East Africa (UNCTAD 2017 : 35).

8.2 Ethiopian Foreign and Economic Policy Under the Eprdf: Context and Objectives

In the early 2000s, the Ethiopian government undertook a major review of the country’s foreign and security policies and strategies against the background of dramatic changes that were taking place in the country, the region, and the world at large. This major internal rethinking resulted in the publication of a comprehensive document, ‘Foreign Affairs and National Security Policy and Strategy of Ethiopia’ in 2002 (FDRE 2002 ).

The shift in foreign and development policy was an outcome of a confluence of internal and external factors. The first factor had to do with the regime’s dissatisfaction with the poor track record of the neoliberal policies that it reluctantly followed between 1991 and 2005 due to pressures from key development partners. The second factor involved deep disagreement within the EPRDF over the conduct of the 1998 war with Eritrea and the political crisis this generated within the Tigray People’s Liberation Front (TPLF)—the influential component of the EPRDF coalition—when the leadership of Prime Minister Meles was challenged (Clapham 2017 ). Once he and his allies had survived the leadership challenge and consolidated their power base, Meles was able to push through radical economic and foreign policy reforms unopposed.

The political crisis following the 2005 disputed national elections, when the opposition gained a significant number of parliamentary seats, provided the EPRDF with a third impetus for introducing far-reaching economic reforms to appease a population opposed to its rule. The EPRDF was forced to acknowledge that its socialist-oriented economic policy was not working and that a new course of action was needed to reorient the Ethiopian economy away from agriculture and towards industrialization and value addition in agriculture. Subsequently, the first Growth and Transformation Plan (GTP1) put heavy emphasis on large-scale infrastructure investments (from roads, rail, and power generation) and investment in education, health, and other services to raise the productivity of the economy and in the process, improve the quality of life of citizens (MoFED 2010 ).

At the same time, the government reoriented Ethiopian foreign and security policy and aligned them to the overall development strategy of the country. The EPRDF redefined the concept of ‘security threat’ as ‘poverty and undemocratic trends’. To address these twin threats, the 2002 Foreign Affairs and National Security Strategy emphasized ‘economic diplomacy’ to attract badly needed foreign investment and loans to transform the economy and to create jobs (FDRE 2002 ). The government particularly focused its economic diplomacy towards emerging countries, such as China, India, and Turkey. The strategy has paid off, as the government has been able to mobilize huge amounts of infrastructure finance and to attract a sizeable number of manufacturing firms to locate in Ethiopia (Cheru 2016 ; MoFEC 2017 ).

8.3 Ethiopia and the Horn of Africa

Ethiopia’s relations with its neighbours have been shaped not only by its internal social, economic, and political dynamics but also by the dynamics of the region which is fraught with conflicts and political instability (Clapham 2017 ; Keller 1987 ). This vast area—comprising Sudan, South Sudan, Ethiopia, Eritrea, Djibouti, Somalia, Kenya, and Uganda, home to about 240 million people—is linked not only by a shared history of conflict but also by a complex web of economic, social, and cultural ties. The incongruence between the legacy of colonial boundaries, ecological zones, ethnic overlap across borders, and cultural affinities peculiar to the region often means that disputes in any one country can have political and economic significance beyond their own local sphere (Cliff 1999 ; Healy 2007 ; Bereketeab 2013 ).

Moreover, the security challenges of terrorism and armed militias are intertwined in a web of various actors that have both regional and global dimensions (IGAD 2016 : 14; Healy 2007 ). China is the latest country to open a naval base in Djibouti. Turkey and the United Arab Emirates are also vying to have a foothold on the Red Sea Coast, highlighting the strategic importance of the Horn of Africa to competing global and regional powers (Hussein 2018 ). Cognizant of these complex geopolitical dynamics and domestic political instability, the Ethiopian government has been working tirelessly to strengthen regional integration and ensure peace and stability in the Horn of Africa. Towards this end, the country has deployed thousands of Ethiopian UN peacekeepers to the Abyi border region between Sudan and South Sudan, the African Union-led peacekeeping mission in Somalia (AMISOM), and the UN peacekeeping mission in South Sudan. The Ethiopian government believes that the task of tackling poverty and underdevelopment at home is intricately linked to the maintenance of peace and stability in the Horn of Africa region (Mehari 2017 ; IGAD 2016 : 46).

In the long-term, however, Ethiopia’s strategy for the Horn of Africa revolves around regional integration through energy, road, rail, and water infrastructure, connectivity, and trade, but very much on Ethiopian terms. The plan is to tie the region to Ethiopia by exporting electricity generated by dams on Ethiopian rivers and to facilitate cross-border trade by improving logistics, rail, and road transport connectivity. Besides mutual economic benefits, regional economic integration is expected to provide a climate conducive to the maintenance of peace and stability in the region (Mulugeta 2016 : 63–87; Mehari 2017 ; Verhoeven 2015 ). Despite these ambitious goals by the Ethiopian government, neighbouring countries do not see Ethiopia in a positive light, and lingering historical animosities cannot be overcome overnight.

8.4 Regional Economic Integration as an Economic and Political Imperative

Ethiopia is one of the few African countries that has taken a radical approach to strengthening economic integration with its neighbours by investing heavily in transport infrastructure, energy connectivity, and improved logistics to help unleash productive potential at the national and regional levels and create a larger regional market and trade interactions (MoFED 2010 ). Several studies have shown that high logistic and infrastructure costs are the key impediments to productive integration on the continent, disrupting supply- and value-chain linkages at the national, regional, and global levels (Foster and Briceno-Garmendia 2010 ; Ndulu 2006 ).

Infrastructure affects growth through two channels: directly through physical capital accumulation and indirectly through improvement in productivity. At a micro-level, investment in infrastructure enhances private-sector activities by lowering the cost of production and opening new markets, presenting new production opportunities and trade. At the same time, infrastructure investment in power generation, water, sanitation, and housing improves the social well-being of citizens (Foster and Briceno-Garmendia 2010 ).

The first Growth and Transformation Plan (GTP1) accorded top priority to massive investment in critical infrastructure, such as roads, rail networks, telecommunications, hydroelectric power, wind and thermal energy, and irrigation projects (Figure 8.1 ). The key targets included the building of 10,000 miles of roads and a 1,500-mile rail network; the quadrupling of power generation coupled with 82,000 miles of power lines; increasing the number of mobile telephone users from 7 million to 40 million and internet service subscribers from 200,000 to 3.7 million; and the establishment of four industrial cluster zones. The cost of these investments was estimated at US$57 billion over the planned period (MoFED 2010 : 33–46). In 2013 budget year alone, the government planned to spend US$7.8 billion dollars on mega projects such as electric power, roads, rail, and public housing.

Moreover, the government has made great efforts to build an efficient logistic service sector for the country’s importers, exporters, and investors by reducing bottlenecks in the shipment of goods and cutting transit time and costs. It has invested heavily to enhance the capacity of the Ethiopian Shipping and Logistics Service Enterprise (ESLSE) through the purchase of additional ships and heavy trucks, and by improving sea and dry dock facilities to reduce transit time and costs to private investors (MoFEC 2017 : 8).

Transformation enablers in the GTP

The massive investments in critical infrastructure are expected to facilitate intra-African trade and regional value chains, leading to Africa’s eventual entry into global value chains. The value-chain linkage would then facilitate accelerated industrial development among the IGAD member countries, namely Djibouti, Sudan, South Sudan, Somalia, and Kenya.

For a landlocked country such as Ethiopia, the issue of infrastructure connectivity involves a different dimension above and beyond the concern for economic growth. Ensuring Ethiopia’s access to the sea is a matter of national security. With the independence of Eritrea in 1993, Ethiopia lost the use of the ports of Assab and Massawa and effectively became the largest and most populous landlocked country in the world. Currently, almost 95 per cent of Ethiopia’s export–import trade is handled through the ports of Djibouti, a situation that Ethiopia hopes to change by seeking additional alternative access routes in the neighbouring countries. The need to diversify its access to the sea is one of the major motivating factors for the Ethiopian government to invest heavily in infrastructure and energy connectivity and to develop friendly relations with Sudan, Somalia, and Kenya.

8.5 Ethiopia’s Proactive ‘Economic Diplomacy’: Results and Performance

Economic diplomacy is the process by which countries engage with the outside world, to maximize their national gain in all fields of activity, including trade, investment, and other forms of economically beneficial exchanges (Rose 2007 : 22–38; Rana, 2004 ). With the adoption of the Foreign Affairs and National Security Policy in 2002 , the Ministry of Foreign Affairs (MoFA) prepared a five-year strategic plan and conducted an extensive business process re-engineering (BPR) study of most of the ministry’s core functions. Among the core functions of the MoFA that have undergone re-engineering are investment, trade, and tourism promotion services (FDRE 2012 ). The exercise resulted in the publication of the ‘Foreign Trade Promotion Manual for Ethiopian Diplomatic Missions’, with the aim of providing practical guidelines to embassy staff on how to carry out trade promotion activities (MoFA 2007 ). Accordingly, the focus of Ethiopia’s economic diplomacy is on the following:

attracting direct foreign investment to the country using different communication methods;

lobbying for facilitating the expansion of the market horizons of the nation’s export products globally;

luring as many foreign tourists as possible to visit the country;

soliciting development assistance consisting of financial and technical support through bilateral and multilateral cooperation.

The economic diplomacy and strategy focuses on attracting labour-intensive rather than capital-intensive investments capable of generating as many jobs as possible, particularly given the high level of youth unemployment. In addition, foreign investments which use agricultural resources as raw materials, and process and produce industrial products by adding value are given prime attention (FDRE 2012 : 25).

As shown in Table 8.1 , Ethiopian missions abroad, in collaboration with the Ethiopian Investment Commission (EIC), have been very active since 2007 in promoting Ethiopia as the best investment destination in Africa (MoFA 2015 : 11). These intense economic diplomatic activities have enhanced the country’s role in regional and international fora. Moreover, Ethiopia’s efforts to attract FDI have been strengthened by a favourable external environment for FDI, the availability of cheap labour in the country, Ethiopia’s improved access to US and EU markets, growing domestic demand, and improved economic infrastructure.

In terms of the regional distribution of investment flow to Ethiopia (Table 8.2 ), Europe and Asia remain the most important source of FDI, followed by the Middle East and North America. Africa plays a marginal role although the number of investors that have made pre-investment visits to Ethiopia is increasing.

Table 8.3 shows that the foreign companies recruited by Ethiopian diplomatic missions represent almost all sectors. Manufacturing, agriculture, energy and power, and construction have attracted the most investors.

Figure 8.2 shows that most of the companies recruited by Ethiopian diplomatic missions are from East Asia, Europe, and the Middle East. China, Turkey, and India are the three most important investors in Ethiopia. This not only reflects the focus of Ethiopia’s economic diplomacy efforts but also how these economies have globally become important sources of cheap labour-seeking FDI. There is a clear recognition within the government of the increasing trend for labour-intensive manufacturing to try to move to countries with abundant supply of cheap labour and a conducive business environment. It is not, therefore, surprising that the Ethiopian government has focused its strategy on attracting FDI from China, India, and Turkey where labour costs are rising. This is a positive trend but its effect on regional integration is mixed (MoFA 2015 : 9).

Number of companies recruited by Ethiopian diplomatic missions conducted pre-investment visit to Ethiopia, 2014/15

In addition to the efforts of the Ministry of Foreign Affairs, the Ethiopian Chamber of Commerce and Sectoral Association have been active in organizing business-to-business meetings with their foreign counterparts and providing information about the considerable business opportunities that Ethiopia offers. In the fiscal year 2016–17, seven business fora took place with investors from Spain, Saudi Arabia, China, Poland, Morocco, the United States, and Germany (MoFEC 2017 : 11–12). It is thought that business fora like these arranged by the private-sector associations reinforce government efforts to build confidence and change the negative perceptions created following the recent unrest in some parts of the country.

In sum, the efforts of the government of Ethiopia to promote economic diplomacy and business-to-business conclaves have been shown to produce tangible results. Renowned textile and garment companies from the United States, Hong Kong, India, China, and Sri Lanka have already launched operations in the Hawassa Industrial Park. Ethiopia’s proximity to the Middle East, European, and Asian markets, its large population, and its preferential trade access to the United States under AGOA and to Europe under the EU’s ‘Everything but Arms’ arrangements, are important reasons why foreign investors are flocking to the country (MoFEC 2017 ). To remain ahead of the game, however, the government must continue to improve the business environment by reducing bureaucracy and red tape, ensuring policy stability and predictability, and developing upstream supply chains, such as cotton for textiles.

8.6 Economic Integration with Igad Countries

This section analyses the trends, performance, and current state of Ethiopia’s economic integration with the countries of the IGAD sub-region and evaluates the overall effectiveness of the economic diplomacy strategy vis-à-vis Ethiopia’s neighbours. This is done using trade, investment, transport infrastructure, and energy as vectors of integration.

8.6.1 Trade Relations

Ethiopia’s external trade is very much dominated by unprocessed primary commodities, while its imports are predominantly manufactured products. Until recent years, a policy of export-led agriculture was encouraged to generate the foreign exchange that the country needs to cover the cost of its essential imports (MoFA 2007 : 12). For example, during the period 2009/10–2015/16, the country obtained on average 89 per cent of its export earnings from unprocessed primary products. 1

Table 8.4 shows that almost 83 per cent of Ethiopia’s exports are to Europe, North America, the Middle East, and Asia. About 20.8 per cent of Ethiopia’s export went to Africa, mainly Somalia (55.8 per cent), Djibouti (21.5 per cent), Sudan (12 per cent), Kenya (4.9 per cent) and Egypt (3.6 per cent), which altogether accounted for 97.8 per cent of the total exports to Africa during 2015–16. By 2016, the value of Ethiopian exports to these countries had increased substantially in comparison to the early 2000s: in current US$ Kenya (30.8 million), Djibouti (109.2 million), Uganda (290,000), Somalia (271.2 million), Sudan (44.5 million) (National Bank of Ethiopia 2017 : 63). Given the similarities in the structure of African economies, with heavy dependence on unprocessed primary products and a low level of industrialization, it is not surprising that Ethiopia’s trade with Africa remains low.

Table 8.5 shows Ethiopia’s import and export trade with the IGAD. While Ethiopia’s exports to Djibouti, Sudan, and Somalia have shown very dramatic increases in recent years, they consist predominantly of a single commodity, chat , which is widely consumed as part of cultural practices in the region. Meanwhile, Kenya and Uganda have not been prominent destinations for Ethiopia’s exports since the two countries are also primary commodity exporters, and their external trade is more oriented towards the developed economies and the East African Community.

On the import side, the most important source of Ethiopian imports is the Middle East and Asia. During the budget year 2015–16, for example, about 62.7 per cent of Ethiopian merchandise imports originated from Asia, 25.1 per cent from Europe, 8.3 per cent America (National Bank of Ethiopia 2017 : 64). The major import origins in Asia were China (53.0 per cent), India (12.0 per cent), Japan (6.7 per cent), Kuwait (5.3 per cent), United Arab Emirates (4.4 per cent), Saudi Arabia (3.6 per cent), Indonesia (3.4 per cent), Malaysia (2.4 per cent), and South Korea (2.1 per cent) (National Bank of Ethiopia 2017 : 64). Africa accounted for a mere 3.9 per cent of Ethiopia’s total imports during the same period and the major countries of origin were Egypt (28.5 per cent), South Africa (27.6 per cent), Morocco (26.7 per cent), Sudan (6.5 per cent), and Kenya (5.2 per cent) (National Bank of Ethiopia 2017 : 65). These five African countries have relatively better manufacturing bases from which Ethiopia can source its imports. On the other hand, countries such as Djibouti, Somalia, and Uganda have been insignificant suppliers of Ethiopia’s import needs. 2

8.6.2 Investment Relations

The EPRDF-led government of Ethiopia has been following a mixed approach to foreign direct investment (FDI) in general. On the one hand it has been relentlessly pursuing policies, strategies, and incentive schemes that are aimed at attracting foreign investment with a view to complementing the domestic private sector and state-owned enterprises, and to securing technology, know-how, capital, and access to markets of advanced economies which it believes can help to achieve its export-driven foreign trade objectives. In this sense, it can be said the government has been one of the most liberal to FDI inflows into the country. However, on the other hand, it has been pursuing one of the most illiberal investment policies in Africa; most of the service sector in Ethiopia (such as retail and merchandise trade, telecoms, banking, and finance) is off limits to foreign investors despite intense pressure from the Bretton Woods institutions and bilateral donors.

Despite the government’s mixed policy on FDI, Ethiopia has become increasingly attractive for market- and resource-seeking FDI from advanced and emerging economies. For instance, FDI stock, which amounted to US$941 million in 2000, increased to US$4.206 billion in 2010 and to US$13.7 billion in 2016 (UNCTAD 2017 : 227). According to Figure 8.3 , FDI inflows have been rising constantly since 2012, even when FDI was declining in many other least developed countries (LDCs). To put this in perspective, East Africa received US$7.1 billion in FDI in 2016, of which Ethiopia alone received US$3.2 billion (45 per cent), propelled by investments in infrastructure and manufacturing which helped it become the second-largest LDC host economy, up from the fifth position in 2015 (UNCTAD 2017 : 46, 81). According to data from the Ethiopian Investment Commission, Ethiopia attracted FDI worth $4.17 billion in the 2016–17 fiscal year despite heightened political tensions in the country since August 2015 (MoFEC 2017 : 13).

Net FDI, US$ millions, and annual FDI growth rate (per cent)

On the other hand, FDI inflows into Ethiopia from the IGAD member countries have been minuscule both in terms of the total capital invested and the number of licensed projects. For instance, data from the Ethiopian Investment Commission show a total of 564 licensed projects in 2017: Kenya (114), Sudan (423), Djibouti (18), and Somalia (9). Table 8.6 shows that, while 187 projects are in pre-implementation stage, another 138 projects are under implementation. Of the four countries studied, Djibouti and Somalia have the lowest level of investment in Ethiopia. The database contains no FDI projects from Uganda at all. 3

Of the four IGAD countries, Sudan is emerging as an important investor in the Ethiopian economy. Out of a total of 423 licensed projects in 2017 from Sudan, 150 are in the manufacturing sector while another 91 are in real estate. Moreover, 159 projects are in operation, 104 under implementation, and 160 projects in pre-implementation stage. In fact, based on information from the Sudanese Investors Society in Addis Ababa, the Economist Intelligence Unit reported in 2014 that Sudanese capital investment in Ethiopia totalled US$2.4bn, making Sudan the second-largest investor in Ethiopia after China.

The large influx of Sudanese investment in Ethiopia had to do with the loss of Sudan’s traditional source of income from oil which ended with the independence of South Sudan in 2011. To offset this loss, the government of Sudan began to cultivate closer relations with Ethiopia, which has embarked on huge hydropower and infrastructure projects to expand its own economic relations with the neighbouring countries in line with the tenets and objectives of the Foreign Affairs and Security Policy. This commitment has been further strengthened by the long-standing no-war, no-peace situation with Eritrea which has severely restricted Ethiopia’s accesses to sea ports, and by the increasingly visible tendency of Sudan to distance itself from its ‘big brother’ in the north (Egypt) and incline towards the main source of the Nile waters (Ethiopia) over the hydro-politics of the Nile.

In the case of investment flow from Kenya to Ethiopia, there exists complementarity between the two economies given the relative advancement and size of the Kenyan economy and its well-developed manufacturing sector. Data from Ethiopian Investment Agency indicate that a total of 114 Kenyan investment projects were registered between 1994 and 2017, with a registered capital of around 2.719 billion birr (~US$100.332 million at exchange rate of November 2017). Of these, only twenty-eight had become operational by September 2017. An interesting feature of Ethiopia’s investment relations with Kenya is that, due to the comparative advantage Kenya has developed in service sectors such as banking, finance, telecoms, and wholesale and retail trade, there has been sustained interest from the Kenyan side in entering these sectors in Ethiopia. 4 However, the Ethiopian government has had justifiable reasons for its reluctance to allow Kenyan investment in these sectors to date.

It is safe to conclude that economic exchanges between Ethiopia and its neighbours are growing, albeit slowly. This is bound to change with increased road and electricity connectivity. While Ethiopia’s efforts to promote economic integration in the Horn of Africa are commendable, a similar level of commitment is required from the other members of IGAD if regional economic integration is to materialize in the long term.

8.6.3 Transport Infrastructure and Services

Given colonial and post-colonial legacies, transport infrastructure in Africa has not only been underdeveloped but also has not been geared towards linking African economies with each other; rather, it is oriented towards export of primary commodities to and import of manufactured products from developed countries (Zinabu 2017 : 96–7). Therefore, any efforts to genuinely integrate African economies requires this outward orientation to be reversed through development of good-quality, efficient transport infrastructure networks and services in such a way as to link production centres and distribution hubs across the continent.

As a landlocked country, Ethiopia has invested heavily over the past decade in transport infrastructure connectivity across the country and with its immediate neighbours to improve economic productivity and raise living standards. Since the launch of the Road Sector Development Programme I in 1997, the Ethiopian Roads Authority has consistently enjoyed the largest allocation of the national budget (Ethiopian Roads Authority 2014 : 9). Between 2010 and 2015, for example, total road network increased from 50,000km to more than 110,000km and is planned to double to 220,000km by 2019–20 during the Growth and Transformation Plan II implementation period (MoFEC 2017 : 5). As of now, the country has good road linkages with Sudan, Kenya, and Somaliland, whereas the road linking it with South Sudan is complete on the Ethiopian side but not developed on the South Sudanese side of the border (Mehari 2017 : 28).

In addition to road linkages, the government has been investing heavily in the development of railways aimed at linking the country to the world market by ensuring seamless access to one or several sea ports in the Horn and East Africa. The primary port for Ethiopia is Djibouti although there are plans to connect to the port of Berbera (Somalia), Port Sudan to the north, and with the ports of Lamu and Mombasa in Kenya. For instance, the Growth and Transformation Plan II (2015/16–2019/20) includes railway infrastructure development as one of its top priorities with a plan to complete development of 2,782km of rail network which would reach the borders with Djibouti, Kenya (Moyale), and South Sudan (Dima). It also includes preliminary plans that would extend the rail links with Sudan (Metema) and Somalia (MoFEC 2015 : 136). So far, only the Ethio-Djibouti railway project, extending for 758km at a cost of around US$4.5 billion (70 per cent over the original estimated cost), has been completed.

The success of regional integration efforts through rail linkages largely depends on Ethiopia’s ability to secure the necessary project financing. Several auxiliary railway extensions into neighbouring countries, namely Kenya, South Sudan, and Sudan, have been planned, but securing the necessary financing has been difficult. With the mounting debt of the Ethiopian Railways Corporation (ERC), which in 2016 stood at US$4.7 billion (or 6 per cent of Ethiopia’s GDP), creditors are unwilling to enter project financing, particularly in the face of declining export earnings. Consequently, the government announced in July 2017 the cancellation of any new railway project until new ways of financing, such as public–private partnerships, are found. The effectiveness of this strategy also depends on the willingness and ability of the neighbouring countries to extend, maintain, and efficiently run the rail and road networks within their borders.

Air transport is one of the areas where Ethiopia has recorded outstanding success, particularly in recent years. For consecutive years since 2001, Ethiopian Airlines, which was founded in 1945 and is a state-owned enterprise, has been registering rapid growth averaging 25 per cent annually. The airline has distinguished itself as the largest and most profitable airline group in Africa, commanding the lion’s share of pan-African passenger and cargo network and now serving more than ninety international destinations. As part of its 2025 vision, the airline intends to provide extensive intra-Africa networks, and extensive and reliable air linkages for African economies with the rest of the world (Ethiopian Airlines 2016 ).

Two points are worth raising with respect to Ethiopia’s relentless efforts to achieve economic integration with neighbouring countries through transport networks and services. First, the effectiveness of these investments largely depends on the political, economic, and security situation in those countries. For instance, the continued political instability in South Sudan and Somalia significantly reduces the economic usefulness and effectiveness of any road and rail linkages with these countries. Second, Ethiopia’s efforts to build economic infrastructure linking it with neighbouring countries have a lot to do with attempts to find alternative access to seaports. Ethiopia’s over-reliance on Djibouti is costly. Ethiopia reportedly spends as much as US$1.2 billion a year for the use of the ports of Djibouti (Mehari 2017 : 28). Besides the high cost, the country faces frequent and serious uncertainties, administrative tussles, and disagreements over costs, fees, and taxation from the Djiboutian side (Styan 2013 : 3,7). In the long run, however, finding amicable solutions to the Ethio-Eritrean conflict could pave the way for Ethiopia to have access to the Eritrean ports of Massawa and Assab that are natural and convenient alternative outlets to the sea.

8.6.4 Energy and Trans-Boundary Water Resources

Ethiopia has substantial potential for generation of renewable energy, with its hydroelectric potential of 45,000MW sufficient to meet most of sub-Saharan Africa’s current demand. Within Africa, Ethiopia’s green energy potential is surpassed only by that of Democratic Republic of Congo (Verhoeven 2015 : 5). However, this potential remained untapped until recently: power generation capacity in the national grid stood at 4,254MW in 2017.

In recent years, however, the government has been heavily investing in energy projects including in three hydro-dam projects on the Gilgel Gibe (fourth and fifth dams are in the works) and the Grand Ethiopian Renaissance Dam (with the capacity to generate more than 6,000MW) on the main tributary of the Nile planned to begin power generation in 2018. While the primary focus of these investments has been on meeting domestic demand, since 2014, however, the government has turned its focus towards the sale of excess electricity to neighbouring countries to generate badly needed foreign exchange (Table 8.7 ). Projections show that Ethiopia’s electricity generation potential is such that even if current consumption levels were to triple or quadruple, there would still be ample scope to export power (Verhoeven 2011 : 6).

The demand for Ethiopia’s electricity is very high and growing fast, both domestically and among neighbouring countries. If we consider domestic demand, between 2002 and 2008 demand for electricity grew on average by 17 per cent annually and this growth is projected to rise to almost 25 per cent annually (Verhoeven 2011 : 5). With respect to international demand, Ethiopia has cross-border electricity connection with Sudan and Djibouti at 230kV level, and there is power flow of up to 250MW to Sudan and up to 90MW with Djibouti (Ministry of Water, Irrigation and Electricity 2017 : 11). The Ethiopian government also has standing agreements to export electricity to Uganda, Tanzania, Burundi, and Rwanda with Ethiopia–Kenya interconnection of 500kV capacity and flow of up to 2,000MW expected to be completed by 2019 (Verhoeven 2011 : 6). The existence of a lucrative demand for electricity in the neighbouring countries, therefore, offers a good opportunity for Ethiopia to capitalize on its ample energy generation potential.

Beyond this obvious economic logic, one can mention three other strategic motivating factors for the ambitious investment of the Ethiopian government in the export of electricity. The first is the need for closer and friendly ties with strategically important neighbours to ease the economic costs associated with being a landlocked country. The second strategic motive is to create an additional source of precious hard currency which Ethiopia needs and to ease its balance-of-payment problems. The third strategic motive is related to Ethiopia’s desire to develop and maintain a strong alliance with Nile basin countries to counter the dominance of Egypt in the hydro-politics of the Nile and ensure fair and equitable utilization of the Nile water resources. In other words, Ethiopia wants to entice and commit these countries into supporting its position with respect to the Nile waters by offering them cheap and affordable electricity.

Overall, Ethiopia’s performance in the African Regional Integration Index has been mixed. Table 8.8 shows that, within the IGAD sub-regional block, Ethiopia ranked fifth out of six member countries that were included in the calculation of the overall index. Out of the five integration dimensions, Ethiopia has scored above the IGAD average only with respect to free movement of people and productive integration. The same cannot be said when it comes to Ethiopia’s role in the Common Market for East and Southern Africa (COMESA). Within the COMESA regional economic community, Ethiopia is ranked 19th out of 19 members, indicating that it is the least integrated country within the block with respect to the five dimensions of integration index (AU/AfDB/UNECA 2016 ). These results suggest that Ethiopia has a long way to go before it becomes a key driver of regional integration in the Horn and Eastern Africa.

8.7 Conclusions

In this chapter, we have examined Ethiopia’s ‘economic diplomacy’ to promote investment and trade with the rest of the world and with its IGAD neighbours. The empirical evidence shows that, by investing heavily in infrastructure and energy, Ethiopia has successfully positioned itself as an attractive investment destination to companies from China, Turkey, India, and other emerging economies. Three important factors play in Ethiopia’s favour: the availability of cheap labour; potential for cheap energy; and Ethiopia’s preferential access to the EU and US markets, which foreign investors want to take advantage of (MoFEC 2017 ).

On the other hand, economic diplomacy towards the neighbours, apart from Djibouti and Sudan, has not produced substantial results. Part of the reason for the low level of economic exchange with the neighbouring countries has to do with the similarities in the structure of their economies. While success in developing the manufacturing sector in Ethiopia can potentially lead to increased intra-Africa trade in the future, the fact remains that most of the FDI projects in Ethiopia aim to produce products destined for advanced economies, with little spill-over effect to the region.

The government’s current approach to trade and investment promotion could be significantly enhanced by systematically involving many relevant government and non-government actors who might possess critical knowledge and information on trade and investment promotion. While export promotion can include activities such as visits by business delegations, arranging buyers-and-sellers meets, FDI mobilization involves sensitizing potential foreign investors to the opportunities in the home country, and thereafter taking targeted promotions. This means that institutions assigned for export promotion must work side by side with the agency charged with the mobilization of foreign direct investment. Such promotions must also be done in consultation with domestic business associations and individual enterprises.

Moreover, economic diplomacy efforts on their own are meaningless unless the necessary macroeconomic policy conditions to promote trade and investment are already in place (Kruger 1990 ). Policy misalignment on many fronts—such as tariff and non-tariff barriers; investment protection; shipping and transport-related challenges; taxation and repatriation of profits—can cause the best-thought economic diplomacy efforts to become undone (Lederman, Olarreaga, and Payton 2006 ). In addition, entry into foreign markets requires a good knowledge of foreign legislation, cultural differences, and local preferences. This will inevitably involve the need to strengthen knowledge and capacity in trade and investment promotion within the Ministry of Foreign Affairs.

In the final analysis, however, Ethiopia’s success in attracting investments and promoting regional economic integration with its neighbours will largely depend on the government’s ability to find a lasting solution to the internal political crisis and long-standing political conflicts with those neighbours. These problems are compounded by increasing meddling from the Middle East and the Gulf States, particularly from Egypt, Saudi Arabia, and the United Arab Emirates (UAE) in the regional politics of the Horn of Africa. These Middle Eastern actors are joined by the United States, China, and Russia, who are increasing their already active presence in the sub-region (Clapham 2017 ; Hussein 2018 ). While the background to the conflicts with Sudan, Somalia, and Eritrea are different from one another, trying to address them requires Ethiopia to take a broader perspective for the region and avoid being perceived by the neighbours as a rising regional hegemon. In terms of priority, resolving the political stalemate with Eritrea and Somalia should be top on the list of Ethiopia’s regional agenda. The status quo of ‘no-war, no-peace’ with Eritrea has not produced tangible results. The Ethiopian government must seek an alternative approach that will produce permanent peace between the two countries. This will pave the way for a much closer economic relationship between Eritrea and Ethiopia, with the current idle ports of Assab and Massawa potentially becoming Ethiopia’s main gateway to the world.

With respect to Somalia, a more cautious approach will be needed given the historical animosity of Somalis towards Ethiopia. Ethiopia’s desire to have access to the port of Berbera in the breakaway republic of Somaliland is unlikely to be received positively by the Somalia Federal Government in Mogadishu. In fact, in early March 2018, Somalia’s lower house of parliament voted to nullify a port investment deal between DP World, Ethiopia, and the autonomous region of Somaliland with a landslide 168 vote out of 170. The agreement, announced on 1 March 2018, would have given landlocked Ethiopia a 19 per cent stake in the port of Berbera, which is being developed by Dubai’s DP World under a thirty-year concession agreement. 5 The port deal, which was concluded without consultation with the federal government in Mogadishu, was viewed as a deliberate violation of the sovereignty of Somalia by the government of Ethiopia.

On the other hand, Ethiopia’s relation with Sudan and South Sudan is less problematic. While Ethiopia has been able to draw Sudan onto its side in the conflict with Egypt over the use of the Nile waters, the South Sudanese political crisis has placed a new burden on Ethiopia, with the latter now hosting over one million refugees inside its borders. Plans to export electricity and increase cross-border trade between the two countries will remain constrained if the political crisis in South Sudan continues. In short, the overall political situation in the Horn of Africa is not conducive for the development of a viable regional integration despite Ethiopia’s effort to the contrary.

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https://www.middleeastmonitor.com/20180305-somalia-rejects-uaes-port-deal

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The Challenges of Diplomacy in a Changing International Order

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In 2020, when celebrating the International Day of Multilateralism and Diplomacy for Peace, United Nations Secretary General António Guterres said that “ it is not enough to proclaim the virtues of multilateralism; we must continue to show its added value ”.

In a globalized and interconnected world, these words are a testimony to our common responsibility. More than words, we need action. And, that action needs to be geared towards protecting an international order that has allowed so many to be lifted out of poverty, that has established dialogue and cooperation as preferential means to handle and ideally solve disputes, and that has created the tools, institutions and rules to deal with such pressing global challenges as climate change.

Diplomacy, through words, and above all deeds, plays an essential part in protecting and developing that acquis and, most importantly, in taking forward concrete initiatives that aim at tackling common challenges that require joint and global action. To do so, it must balance reality and perception, be firm on universal values and principles, and uphold the rules and norms that shape the international system.

1 The Importance of Reality and Perception

As foreign policy is not conducted in a vacuum, it must not ignore the importance of context. A well-intentioned action may be perceived by others as something different. There lies one of the main tasks of a diplomat: understanding first and then explaining, thereby reducing the gap between reality and perception; a difficult task by any standard. One that was certainly made more challenging by the evolving nature of the international system.

Fifty states signed the United Nations Charter in 1945. The organization now has 193 Member States. This extraordinary evolution has only increased the importance of dialogue, mutual understanding and cooperation.

When analysing today’s world, one must not forget that while globalization has done much to reduce distances and increase connectivity, differences, sometimes substantial, still remain. Not only in political culture, but also in economic models and social norms. The temptation that may exist to use one single lens to analyse different realities is, therefore, short-sighted. To be aware of this complexity can be both alluring, as it challenges us to learn more about the other, and daunting.

One of the main challenges we face in today’s world is, therefore, to know the other; to listen, observe and understand—not necessarily to agree, but to be able to comprehend.

If this is true for someone who, as a diplomat, is posted in a foreign land, it is also the obligation of any country that desires to play a part in today’s world. Taking action without contemplating its consequences or expecting others to fully understand a given deed without considering the existence of different viewpoints may be counterproductive at best or reckless at most. None of these serves foreign policy correctly.

Narrowing the gap between reality and perception, making sure the latter is as close as possible to the former, is, therefore, essential for all international actors, so that they are fully understood, correctly analysed and properly assessed. To achieve this, a joint effort is required. The observer needs to fight off its potential pre-conceived ideas or bias. The observed party needs to be aware that those might still exist.

World history is full of examples that illustrate the complexity of this exercise. Moreover, today’s international stage is a powerful reminder of how difficult this task is.

2 The Centrality of Values and Principles

There is, however, a common ground that allows all to share a joint perspective and where the risk of misperception can be greatly reduced: the values and principles we share.

Since at least 1945, the notion that there are universal principles common to all of humanity has been deeply integrated into the international system. These do not imply a notion of superiority, but rather of union. They do not aim to impose, but rather to share. And, they are not a power tool, but rather a tool for empowerment.

The fact that these values and principles are widely shared should, therefore, be seen as a conquest and a victory, as it represents a common ground on which we can build. A discourse based on these values does not need to be seen as a lecture, as different views on how to achieve some of them do not need to be taken as deviations from its importance.

As the current international set of shared values and principles demonstrates, there is always room for debate and improvement. Some of those that are taken for granted today were the result of strong debates some decades ago.

With this evolution, there came great responsibility. What may be viewed by some as interference may be thought of by others as a direct consequence of transparency, information and joint accountability to values and principles enshrined in international documents signed by all. What others may think of as a tool to diminish certain feats and conquests should be taken up by others as an opportunity to showcase the implementation of a commitment to development in all of its dimensions.

3 The Relevance of Rules and Norms

All of this is made possible because ours is a rules-based international order. International law, the end of secret pacts or treaties, the ability to jointly define norms and patterns through dialogue, cooperation and an open exchange of views are some of the world’s most important achievements.

Though sometimes discarded by some as a sign of weakness and viewed by others as a tool to be used only when that is deemed useful, the notion that the world has a set of rules and norms that is shared by all and that can be jointly shaped, defined and, therefore, understood is a development that cannot be underestimated.

The United Nations plays a central role in this common and shared architecture. An organization where all countries are equal, despite of their size, economic weight or geographic location; an organization where all issues—big or small—are jointly discussed and analysed; an organization that shapes our daily lives.

Whether telecommunications, global health or trade, the United Nations has, through its various specialized agencies, created a more unified and connected world. Unity and connection equal stability, and stability means predictability, for states, but also for businesses and individual citizens.

All of this has made globalization possible. It enabled trade to flourish, barriers to be taken down and knowledge to be shared. It brought countries and peoples closer. Its benefits in terms of economic development, poverty alleviation or technological advancements are beyond anything the world that had ever seen before. And, all of this was made possible because there were common rules and a shared desire to develop others when and where needed. The World Trade Organization is a perfect example of this. Its creation represented a fundamental stepping stone for the current rules-based international order. And, the current debate on its reform signifies that there is joint understanding that this track record needs to be kept and updated to fit into today’s world.

Temptations to deviate from this shared rule book or to drive some out of this joint undertaking are, therefore, detrimental to the whole world, for they stand in contrast with what enabled us to reach this far: a stage where trade is both free and fair; one where commitments are made and respected and where development needs are understood, but do not stand in the way of progress and respect for common values.

4 The Example of Portugal

Portugal is an example of the benefits brought about by this approach. A tripod based on an open and frank dialogue with all, a firm defence of shared values and a strong belief in the benefits of a rules-based international order, has been the hallmark of Portuguese foreign policy for decades. It is based on a widely shared political consensus at home and has served us well when navigating an increasingly complex international environment.

As a firmly pro-European country, Portugal has found in the European Union a perfect example of the benefits of this approach. Having joined in 1986, alongside Spain and thereby elevating the number of Member States of the then-European Community to twelve, Portugal is now a proud member of a family that brings together 27 countries; an organization where the pooling of sovereignty is not seen as a loss, but as a gain; where dialogue and compromise have replaced confrontation; where, despite the qualified majority rules in a vast array of areas, member states still try their best to reach a common position with which all can be comfortable. These achievements were not without its costs. They were made possible by a conscious decision to favour law instead of might and to listen before deciding rather than to impose.

This focus on dialogue and understanding is also what Portugal brings to the table when honouring its centuries-old relationship with many countries around the globe. Ours is a history of discovery and adventure; a journey made with people of different origins and backgrounds; a path paved with diversity and openness.

All of this makes Portugal acutely aware of the need to listen and to talk. It is what we do while at the helm of Presidency of the Council of the European Union, attempting to bring countries together and rally behind solutions and compromises that benefit the common good. It is how we act when interacting with countries and regions whose history, traditions and cultures are not the same as ours. It is the way we are.

This open identity is what makes us acutely aware of the need to engage with African countries and build a true partnership of equals, to maintain solid relations with Asian countries, whose importance for the world will only increase in the next few decades, and to defend the vitality and central importance for Europe of the transatlantic links—with both North and with Central and South America.

5 Global Challenges

The current rules-based international order—where debate is possible and encouraged, norms are openly discussed and updated when necessary and international law is the glue that binds countries together—has been instrumental to the world’s development and will be equally central when addressing the many challenges humanity is facing.

Climate change is the most evident and pressing of these. As there is only one planet and no “Plan B”, there can be no other approach to deal with the effects of climate change other than a cooperative and multilateral one. With the Paris Agreement at the core and a common understanding of what needs to be done, namely achieving carbon neutrality, the world must invest in new and green technologies, phase out old and polluting ones, and thereby reap the social and economic benefits that will undoubtedly arise from a green transition.

In an age where countries are faced with the erosion of their coast lines, the desertification of their land or a loss of biodiversity that threatens agriculture and biological balance, climate change is a challenge that summons us all. It is, therefore, one where nationalism plays no part, as the gains of the one will be the gains of all, and the loss of the few will be felt throughout the globe.

The same applies to international cooperation on health issues, as the current pandemic so acutely demonstrates. In an age where no one will be safe until everyone is safe, international cooperation is fundamental to overcome a problem that has affected us all. While some may have more tools to deal with it, no instrument will be powerful enough to protect one given country or region from a problem that is global in nature which is why multilateralism, dialogue and cooperation are so important, particularly in defending a science-based approach or in the sharing of data and information in a transparent and verifiable way, as the development of vaccines has so clearly illustrated. Let us not forget that the majority of vaccine research and development was only made possible by multinational alliances between different countries and institutions, and even those which did not rely on such partnerships were only successful because science and the sharing of knowledge know there are no boundaries or limits.

6 Conclusion

Building a post-pandemic world will, therefore, require that all these lessons are correctly understood and incorporated into the way countries speak and act on the international stage. If cooperation and dialogue are essential in overcoming the challenges faced by all, shouldn’t they also be the hallmark of the way we approach areas where understanding and common solutions are lacking?

Different countries with different cultures will probably always see and interpret certain facts in a different way. That does not mean that there is not a common ground uniting us all: the values we share, enshrined in international treaties, declarations and resolutions; the architecture jointly built by all, where the United Nations and international law play a central and fundamental role; and the common responsibility to talk and listen.

Certain countries, due to their size, population or economic weight, have a particular responsibility in driving this approach forwards, which is why the behaviour of some is more closely scrutinized than others. As with great power, there comes great responsibility, which should not come as a surprise, but rather as an incentive to do more and to do better for the benefit of all.

Diversity is one of the world’s most enriching qualities, one that defines and challenges us, but also one which must not lead to forced isolation or forceful imposition. If we live in a global and interconnected world, the actions of one may and sometimes do impact others, which is why we must all—diplomats, politicians, civil society, academia—make an effort to think how one’s actions may impact the view of others. This is why, the need to care and foster for our common values should not be seen as interference, but rather as a platform for dialogue and common improvement; why dialogue should never be cast aside; and why cooperation should always be the preferred option over confrontation. As foreign policy begins at home, the challenges of economic recovery and of the green and digital transitions should be seen as a way to take this common approach forwards.

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Duarte, J.A. (2022). The Challenges of Diplomacy in a Changing International Order. In: Wang, H., Miao, L. (eds) China and the World in a Changing Context. China and Globalization. Springer, Singapore. https://doi.org/10.1007/978-981-16-8086-1_17

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Helicopter Carrying Iran’s President Has Crashed, State Media Reports

Rescuers are trying to locate the helicopter on which President Ebrahim Raisi and Foreign Minister Hossein Amir Abdollahian were traveling, state media reported. Their status is unknown.

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By Farnaz Fassihi

• May 19, 2024

A helicopter carrying President Ebrahim Raisi of Iran and his foreign minister crashed on Sunday in the country’s mountainous northwest, according to state media, deepening the turmoil that has gripped the nation on both the international and domestic fronts in recent months.

Mr. Raisi, 63, was traveling from Iran’s border with Azerbaijan to inaugurate a joint dam project. The helicopter, carrying Mr. Raisi and Foreign Minister Hossein Amir Abdollahian, state media reported, crashed near the city of Varzaghan around 1 p.m. local time, in bad weather and thick fog.

Search and rescue teams scoured an area of tall mountains and dense forest through rain and fog for more than 10 hours. At one point the authorities called off the aerial search because of the weather, dispatching on foot soldiers, elite commandos of the Revolutionary Guards and 40 rescue teams to locate the crash site.

Even well into the night, state media had not yet reported on casualties, or on the condition of the president or anyone else aboard. The cause of the crash was also unknown.

“There will be no disruption in the country’s operation,” Supreme Leader Ayatollah Ali Khamenei said in an address on state TV. “Senior officials are doing their work and I have advised them on the necessary points and all of the country’s operation will carry on smoothly and orderly.”

Mr. Raisi, a conservative who violently crushed dissent, is widely viewed as a possible successor to the supreme leader. The uncertainty over his fate comes during a particularly tumultuous period for Iran.

Its long shadow war with Israel burst into the open after Hamas attacked Israel on Oct. 7, setting off the war in Gaza and a cascade of strikes and counterstrikes across the region.

The hostilities became even more pronounced after Israel conducted airstrikes on a building in the Iranian Embassy complex in Syria in April. Iran retaliated with its first direct attack on Israel after decades of enmity, launching more than 300 drones and missiles toward the country, many of which were shot down.

Domestically, Iran is also facing widespread anger, with many residents calling for an end to clerical rule. Corruption and sanctions have gutted the economy, stoking frustrations.

In the last two years, the country has witnessed a domestic uprising, the Iranian currency plunging to a record low, water shortages intensified by climate change and the deadliest terrorist attack since the 1979 founding of the Islamic Republic.

Source: Iranian state and semiofficial news agencies

By Charlie Smart and Lauren Leatherby

If the president dies, the vice president takes over and elections must be organized within 50 days, said Ali Vaez, the Iran director of the International Crisis Group, an independent conflict prevention agency.

That, he said, would be “a major challenge for a country that is in the midst of a severe crisis of legitimacy at home and daggers drawn with Israel and the United States in the region.”

Mr. Raisi is a hard-line religious cleric who came of age during the country’s Islamic revolution. Under Iran’s theocratic system, Mr. Raisi, as president, is the second most powerful individual in Iran’s political structure after the supreme leader, Mr. Khamenei.

After becoming president in 2021, Mr. Raisi consolidated power and marginalized reformists who wanted to defuse tensions with the West. He repeatedly said that he pursued a policy of “strong diplomacy,” forging closer economic and security ties with Russia and China.

During Mr. Raisi’s tenure, Iran continued to expand its regional influence, backing proxies across the Middle East that have conducted strikes against Israel and the United States, as well as advancing the country’s nuclear program.

In the same period, Mr. Raisi oversaw a sweeping and deadly crackdown on domestic protesters, many of them women and young people, who had taken to the streets against the country’s ruling clerics. Rights groups said hundreds of protesters were killed by the nation’s security forces.

Mr. Raisi has been viewed as one of the front-runners to succeed Mr. Khamenei as supreme leader. One of his main rivals for that role is a son of Mr. Khamenei.

Despite the crash, some analysts said they did not expect a major change in Iran’s agenda abroad.

The nation’s supreme leader is responsible for setting all of the country’s policies, analysts said, while the president’s power comes from enacting those decisions.

“At one level, the outcome does not portend a sea change in how Iran formulates and acts upon its interests abroad,” said Ali Vaez, the Iran director for the International Crisis Group.

“It is the supreme leader who makes strategic decisions about foreign policy, albeit informed by the views of other key stakeholders, including the president.”

Mr. Abdollahian, the foreign minister, has been heavily involved in regional diplomacy with Arab countries. In recent months, he had also met in Qatar with leaders of the militant groups backed by Iran, including Palestinian Islamic Jihad and Hamas, the group that led the Oct. 7 attack against Israel.

He was also engaged in secret indirect talks with the United States, in February and in May, in Oman to discuss defusing tensions and relieving sanctions related to Iran’s nuclear program.

Vivian Nereim contributed reporting.

Farnaz Fassihi is the United Nations bureau chief for The Times, leading coverage of the organization, and also covers Iran and the shadow war between Iran and Israel. She is based in New York. More about Farnaz Fassihi