Abstract
This article discusses the relationships between government and business, relating commercial diplomacy and international business success. It calls for more research on commercial diplomacy by international business scholars. It presents a short description of what commercial diplomacy is and most importantly, how, from an international business point of view, research should be undertaken in terms of business-government communication as well as the organization and value creation process of commercial diplomacy.
Highlights
The world economy is a dynamic environment full of opportunity and risk for international business
The shift of economic opportunity from developed to developing economies means that international business has to navigate growth in economies where the formal regulatory and institutional context for doing business is very different from that which the business is used to and with often a very active role for the state
This is certainly the case with China and is a characteristic of the political economies of India, Brazil and Russia. It is in this context, the unfamiliarity of the political contexts of new market opportunities, that commercial diplomacy driven by close nation-state –business collaboration and diplomatic support for international business is needed and, thatthe need to expand and develop commercial diplomacy is all the more important (Lee & Ruël, 2012: xiv)
Summary
To understand how commercial diplomacy and international business go hand in hand, one only needs to consider how trade and aspects of diplomacy have propelled civilizations into becoming great economic powers. In somewhat more recent times, the Dutch established an embassy in China in 1655 with the specific objective to improve trade and a new country called the USA would significantly change global economic and commercial relationships. A quite modern version of commercial diplomacy was adopted by the USA as Page (1902: 167-168) notes: ‘through the principle of reciprocity she proposed to abolish exclusions, monopolies, and preferences, and to promote the advantages of both nations rather than “by outwitting the other” to secure some exclusive advantage for herself’. Commercial diplomacy has in some sense been around for a considerable amount of time and the concept is nothing new
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