Research Significance, Outcomes, and Policy Suggestions

Abstract

This chapter examines the transformative potential of economic diplomacy in redefining the diplomatic and economic relations between Bangladesh and Latin American countries (LAC). Despite substantial geographical distance and limited historical ties, economic diplomacy emerges as a strategic instrument to foster bilateral cooperation, leveraging complementary economic strengths and aligning with global trends. The research identifies Bangladesh’s core export competencies—textiles, pharmaceuticals, and jute—as strategically aligned with LAC’s market needs. Similarly, LAC’s abundant agricultural and mineral resources align with Bangladesh’s import requirements. However, significant challenges persist, including logistical constraints, cultural and linguistic differences, and the absence of direct trade routes. These are compounded by minimal institutional frameworks, such as bilateral agreements or joint economic platforms. A conceptual model is proposed to operationalize economic diplomacy, emphasizing key pillars: trade facilitation through free trade agreements and public–private partnerships (PPPs), infrastructure and connectivity development to mitigate logistical barriers, and cultural diplomacy to bridge socio-cultural divides. Furthermore, the model advocates targeted sectoral engagements in renewable energy, sustainable agriculture, and technology transfer, highlighting opportunities for collaborative ventures in shared developmental challenges such as climate resilience and digital transformation. Policy recommendations stress the establishment of dedicated economic diplomacy councils, enhanced diplomatic footprints through embassies and consulates, and the introduction of bilateral investment treaties (BITs) to provide a secure legal framework for cross-border investments. Developing direct shipping and aviation links, diversifying export portfolios, and organizing trade fairs are highlighted as practical steps to strengthen economic engagement. Additionally, fostering academic and cultural exchanges is posited as essential for cultivating mutual understanding and long-term relational stability. The chapter concludes that economic diplomacy offers a sophisticated framework for Bangladesh to recalibrate its engagement with LAC, transcending traditional diplomatic paradigms. By leveraging economic complementarities, addressing logistical and institutional barriers, and aligning with global shifts towards South-South cooperation and sustainable development, Bangladesh and LAC can establish a robust and mutually beneficial partnership. This approach not only enhances bilateral trade and investment but also positions both regions as proactive stakeholders in the evolving global economic order.