Economic and Commercial Diplomacy: State and Commerce Implement a Range of Activities, but State Should Enhance Its Training Efforts

GAO-22-104181 Published: Dec 13, 2021. Publicly Released: Dec 13, 2021.
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Fast Facts

Increased globalization and recent economic and financial crises have heightened concerns that U.S. businesses may be at a disadvantage in foreign markets. The departments of State and Commerce play key roles in the U.S. government's efforts to support U.S. businesses abroad.

State trains its employees to support U.S. business expansion abroad. However, it doesn't conduct periodic, comprehensive assessments of training needs in this area. Therefore, it cannot know whether its training program meets current or future needs, or prioritizes the right content. Our recommendations address these issues.

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Highlights

What GAO Found

The Departments of State and Commerce implement a range of economic and commercial diplomacy activities domestically and overseas, to promote U.S. commercial interests and support U.S. business efforts to enter or expand in foreign markets. These activities range from engagement with foreign governments and policy advocacy, to information sharing, guidance, and individual services for businesses, and awards for overseas post activities, such as projects to raise intellectual property rights awareness. Over 3,600 State and Commerce personnel on average conducted these activities domestically and in a number of foreign countries in fiscal years 2016 to 2020. These personnel included an annual average of over 900 State and Commerce Foreign Service Officers overseas (see table).

Average Annual Number of State and Commerce Foreign Service Officers Overseas with Economic and Commercial Diplomacy Responsibilities and Assignment Locations, Fiscal Years 2016 to 2020

Region

State

average number of staff

State

number of countries

Commerce

average number of staff

Commerce

number of countries

East Asia and the Pacific

148

21

62

11

Europe and Eurasia

201

45

48

20

Near East (Middle East and North Africa)

87

16

17

9

South and Central Asia

70

11

11

3

Sub-Saharan Africa

107

41

12

8

Western Hemisphere

136

29

39

14

Total

748

163

189

65

Source: GAO analysis of Departments of State and Commerce data. | GAO-22-104181

Note: The regions in this table represent State's six overseas regions. Average numbers may not sum to totals because of rounding. For more details, see figure 2 and table 3 in GAO-22-104181.

State offers a range of economic and commercial diplomacy courses for relevant personnel, but GAO found weaknesses in State's training efforts. State's training addresses broader economic and commercial issues as well as specific topics, such as intellectual property rights. GAO found that State has incorporated aspects of the four components of an effective federal training program—planning, design, implementation, and evaluation—into its training efforts. For example, on evaluation, State generally obtains participant feedback for all of its courses. However, GAO found that State does not consult with external stakeholders, such as Commerce and private sector entities, on whether its training is achieving the desired impact. GAO has previously identified that incorporating a wide variety of stakeholder perspectives can help agencies to assess such impact. Although State officials noted that they have coordinated with Commerce to share information on training offerings and may obtain indirect input from the private sector on training, State has not established a mechanism to consult with external stakeholders regarding the impact of its training. As a result, State lacks reasonable assurance it is obtaining appropriate stakeholder perspectives and feedback on whether its personnel engaged in economic and commercial diplomacy are adequately equipped to support U.S. businesses overseas.

Why GAO Did This Study

Supporting U.S. global competitiveness is a longstanding area of U.S. government interest. Increased globalization and recent economic and financial crises have heightened concerns that U.S. businesses may be at a disadvantage in foreign markets. State and Commerce play key roles in the U.S. government's efforts to support U.S. businesses in foreign markets. The Championing American Business Through Diplomacy Act of 2019 includes provisions focused on improving the efforts of State and Commerce to support U.S. businesses abroad through economic and commercial diplomacy.

The act includes a provision for GAO to report on several issues related to these agencies' efforts in this area. This report describes State's and Commerce's activities in support of U.S. businesses abroad and staff resources provided for these efforts; and assesses State's economic and commercial diplomacy training against GAO criteria for effective federal training programs. GAO reviewed documentation, assessed the reliability of agency data on staff resources and training for fiscal years 2016 through 2020 (the most recently available), and interviewed agency officials.

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Recommendations

GAO is making three recommendations to State, including that State should establish a mechanism to consult periodically with external stakeholders on whether its training is achieving the desired impact. State concurred with GAO's recommendations.

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of State
Priority Rec.
This is a priority recommendation.
The Secretary of State should ensure that the Foreign Service Institute develops and implements a process to conduct periodic, comprehensive assessments of training needs across the economic and commercial diplomacy issue area. (Recommendation 1)
Open
In its written comments on the draft report, State concurred with this recommendation and recognized that the department should strengthen its economic and commercial diplomacy training efforts, including through a regular training needs assessment process. State added that it had taken steps to initiate a regular training needs assessment process for its economic and commercial diplomacy training, working with EB and other internal stakeholders to review the content, mode, and frequency of training, and to prioritize training across the issue area. To fully implement this recommendation, State needs to provide documentation showing that it has developed and implemented a process for conducting periodic, comprehensive assessments of economic and commercial diplomacy training needs. As of September 2022, we continue to monitor State's actions to implement this recommendation.
Department of State The Secretary of State should ensure that the Bureau of Economic and Business Affairs, in collaboration with the Foreign Service Institute and other bureaus as appropriate, develops career guidance on competencies and training for the State Civil Service, Foreign Service, and locally employed staff with roles in economic and commercial diplomacy. (Recommendation 2)
Open
In its written comments on the draft report, State concurred with this recommendation and stated that in response to the recommendation, the department planned to develop career guidance on competencies and training for State personnel with roles in economic and commercial diplomacy. As of September 2022, we continue to monitor State's actions to implement this recommendation.
Department of State
Priority Rec.
This is a priority recommendation.
The Secretary of State should ensure that the Foreign Service Institute establishes a mechanism to periodically consult with external stakeholders, including Commerce, private sector entities, and industry groups, about whether State's training programs in economic and commercial diplomacy are achieving the desired impact. (Recommendation 3)
Open
In its written comments on the draft report, State concurred with this recommendation and stated that it planned to take steps to implement it, including establishing a stakeholder advisory group through which it planned to engage private sector and industry groups on training. State added that it had also communicated with the U.S. Department of Commerce to initiate regular meetings to discuss economic and commercial diplomacy training, including whether training is achieving the desired impact. To fully implement this recommendation, State needs to provide documentation showing that it has established a mechanism for periodic consultation with external stakeholders. As of September 2022, we continue to monitor State's actions to implement this recommendation.

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