Business Diplomacy and Subnational Government Economic Relations: Complementary, Rivalry or both Regarding to Central-State?

Pedro Conceição Parreira*

pedronuno20@hotmail.com

Provisional Abstract

Particularly since the start of the new Millennium a pertinent literature on business diplomacy has been on the rise. This new literature is covering an important area of multinational enterprises (MNEs) practices but still looking to central-state/countries, international organizations or even to a less extent non-governmental organizations (NGOs) as the main if not the only unit of analysis. Nonetheless its importance, from a subnational government level much is going on too but lesser analyzed.

Using an historic top-down perspective to frame the heart of the discussion, this paper aims to look for the MNEs business diplomacy long term strategies and practices targeting mainly subnational governments: (a) sometimes MNEs complement the business diplomacy approaches or negotiations to central-governments with subnational governments such as federal-states, Landers, regional administrative authorities, municipes or city halls to go deeper in the negotiations or to reach better and bigger economic benefits; (b) other MNEs approach or negotiate firstly with subnational governments aiming later on to have a local authority ally to help them out to put pressure on the negotiations with central-governments; (c) finally and already no less important, many MNEs evolve business diplomacy practices directly and only with subnational governments due to its political power, financial  autonomy and specific geographic location.

In a final section from a state perspective, we try to shed light if these growing realities are complementary, rivals or both regarding the economic diplomacy model of central-state.

*Researcher - Higher Institute of Politics and Social Sciences, University of Lisbon.