Execute Economic Diplomacy For Growth

Economic diplomacy refers to the skillful management of state issues in the international arena to promote economic agendas politically and strategically.  It is thus a form of diplomacy which requires the exercise of all economic tools to optimise national interest. Consequently, the concerned diplomats should possess in-depth expertise in economic policy and should be capable of reporting to the home country on the theoretical and practical economic issues of the host country. They should be able to advise his home country on how to derive maximum benefit from their current posting.

Traditional diplomacy, focused primarily on narrow business interests of a nation, cannot be sufficient for realising a state’s economic development. The present age has leapt far ahead of the traditional concept of economic diplomacy. In the contemporary world, it embraces sectors like exports-related all domestic policies, imports, aid, loan, investment, tourism, free trade agreement and other sectors of the society which include issues that directly relate to the questions of human existence and eco- system.

Comprehensive understanding

This means that maintenance of human rights, climate change, clean environments, technology and the management of pandemics also must be addressed. These issues cannot be ignored because, in this modern age of globalisation and advanced communication, they are interconnected globally. Restoring and maintaining these areas plays a vital role in economic advancement and ignoring them could result in mass devastation. A diplomat, therefore, must have a comprehensive understanding of all these things and a sincere spirit to act accordingly.

Economic diplomacy in the modern era is indeed a vast concept requiring versatility, flexibility, sound judgement, strong business skills in addition to farsightedness and quick decision-making. Besides the diplomats and other related government agencies, there are non-official entities like NGOs, and business leaders and investors who play equally important roles in a country’s advancement. Success depends on the commitment as well as competence of the diplomats who are motivated enough to play an effective role in favour of the country the diplomat represents.  When a diplomat is truly competent, the role is exercised in such a way that the country can embrace comparative benefits in most, if not all, areas of economic activities like foreign trade, investments, technology, tourism etc. 

However, one must remember that every aspect of economic diplomacy is always guided by the political environment of the country concerned and by the government’s overall foreign policy. Nepal's foreign policy in the royal era was largely determined and directed by the palace.  After the restoration of multiparty democracy in 1990, politicians with vested interests failed to adapt to the fast-changing environment. Furthermore, most of the ambassadors deputed in various countries were nominated on the basis of nepotism rather than merit, lacking the seriousness or comprehension required for their missions. Consequently, they failed to play their role adequately. Even career diplomats have, with very few exceptions, often failed to demonstrate their efficiency needed to benefit the country.

In this connection, the Institute of Foreign Affairs (IFA) cannot shirk its responsibility. Apart from a few cases of training to the officials of the Ministry of Foreign Affairs (MOFA) and nominated ambassadors, it has yet to establish regular orientation for foreign ministry personnel. Additionally, the IFA faces hurdles like an inadequate budget and restrictive ministerial control over spending. These are reasons why Nepal’s image in the international arena has not risen whereas quite a few nations smaller than Nepal have done better. This also partly explains its failures in economic diplomacy.

The irony here is that the experts’ advice remains on paper, rarely practiced. The case is hardly different on the front of economic diplomacy. The following steps are necessary to break this conundrum:  First, the politicians need to regularly meet to arrive at a common decision, freeing themselves from prejudiced and preoccupied views. Second, the people in authority need to be well experienced, educated and professionally trained as well to understand the crux of the issues at hand to play their role accordingly. Third, the ideas produced by the experts in the seminars need to be incorporated in the foreign policy if they are beneficial to the country even if the ideas challenge the concerned authority.

Fourth, the evaluation of ambassadors should be relentlessly done annually and they should be awarded or punished according to their performance. Fifth, the IFA needs to be well equipped according to the needs of the times. It must be proactive and must function rigorously. The trainers can be personnel of the government or can be hired. If these things are maintained, both public diplomacy and economic diplomacy will serve their roles in the international field to elevate Nepal’s dignity, and to benefit its economy and pace of development.

Quality exportable items

Encouragement of the production of quality exportable items and elimination of bureaucratic hurdles and burdensome paper formalities will boost our global competitiveness to augment our economy.  Relying solely on exporting our labour to the international market lowers our national dignity. Nepali workers abroad may have unburdened the potential disturbances at home from the high level of unemployed mass. But the exodus of youth entails a heavy loss of human resources in the long run who are the prime resource for this nation’s development. 

Had we been able to send some of our intellectuals and experts at the request of our friendly countries as ‘think tanks’ for a certain period to help them develop their country, our national dignity would have naturally been reached the apex. We must think seriously and act immediately on these matters because they are the true drivers of our economic diplomacy.

(The author is the former Consul General to Kolkata, India)