Do we need more economics in Australian economic diplomacy?

ABSTRACT

Economic diplomacy—that is, informal and formal processes and links between states and non-state actors on international economic issues—is a current focus of Australian foreign policy. The Department of Foreign Affairs and Trade’s stated economy diplomacy aims are liberalising trade, boosting economic growth, encouraging investment and assisting business. If Australia is to embrace a genuine and effective notion of economic diplomacy there are two problems to be overcome. First, DFAT’s economic diplomacy framework is incomplete and misses the bigger economic picture, particularly the role of Australia’s key economic agencies, Treasury and the Reserve Bank of Australia. Second, DFAT does not consistently apply economic principles to foreign affairs issues including trade, foreign aid and the global investment agenda. Going forward, Australia should abandon the focus on the four narrow pillars and instead focus on developing a clear, coordinated international economic strategy that articulates Australia’s core international economic objectives and priorities.

KEYWORDS:

• Economic diplomacy
• G20
• trade
• foreign aid
• economic policy

Disclosure statement

No potential conflict of interest was reported by the author.