Log in to get started!

Don't have an account yet? You can create one below.

Student Instructor
Boxes of relief items from USAID arrive

Economic Statecraft: Foreign Assistance

This pop-up case is part of the series: Tools of Foreign Policy


Economic statecraft describes the various economic tools countries use—such as lending, foreign assistance, sanctions, and trade agreements—to advance their foreign policy priorities. In this hypothetical scenario, the United States needs to decide whether to help a country in crisis and, if so, how to best employ a specific tool of economic statecraft: foreign aid.


First, cover the fundamentals of this foreign policy tool with World101's lesson, What Is Economic Statecraft? Then, put these principles into practice with Model Diplomacy's hypothetical decision point below.

Decision Point (Hypothetical)

Drought and flood cycles caused by climate change have ravaged Durhan’s most important crop, corn. This has resulted in farmers losing their livelihoods, a decline in Durhan’s gross domestic product, and near-famine conditions in many parts of the country. Although Durhan’s economy is in shambles, its geographic location means that it could be a useful strategic partner for the United States. Durhan is positioned along two major trade routes, including a crucial port, and is near several countries that U.S. intelligence suspects of harboring terrorists. The U.S. president has convened the National Security Council (NSC) to decide if the United States should provide foreign assistance to Durhan and whether to place conditions on it. 

NSC members should consider the following policy options:

  • Offer assistance to Durhan, but require security cooperation in return. The aid could include both immediate humanitarian aid, as well as investment in developing drought-resistant farming and alternative industries. The security cooperation could include a refueling and resupply agreement for passing U.S. Navy vessels, the use of an airbase for drone flights, and intelligence sharing. Such an agreement could fulfill goals for both countries. However, Durhan may reject the proposal, leaving the United States looking uncharitable.

  • Offer assistance to Durhan without requiring any conditions. The aid package could be similar to the previous option, but the United States would ask nothing explicitly in return. However, the goodwill generated could lead to security cooperation in the future. Such an offer would alleviate suffering in Durhan, but does not guarantee any tangible benefit to the United States.

  • Provide no assistance to Durhan, but encourage other countries or international organizations to send help. This option could allow limited government resources to be devoted to other priorities, such as research into developing new drought-resistant crops at U.S. universities. Although this option does nothing to alleviate immediate suffering in Durhan, it could lead to breakthroughs down the road. It also risks hurting the U.S. image abroad and does nothing to advance U.S. strategic interests in the region around Durhan.

More Pop-Up Cases

Taiwanese and U.S. Flags

China’s growing military and economic strength, coupled with its increasingly aggressive posture in East Asia, have raised questions about U.S. policy toward Taiwan. Should the United States maintain its longstanding policy of strategic ambiguity toward Taiwan, or should it clarify its stance?

Sunlight behind clouds

As the threat of climate change continues to grow, some policymakers are starting to consider solar geoengineering: reflecting sunlight in the atmosphere to counter global warming. The idea could offer a vital tool against climate change, but it could be risky, especially without worldwide coordination on its use. How should the United States approach solar geoengineering?

Zelenskiy speaks with an American Delegatiion

Ukraine has withstood Russia’s initial invasion, but a new phase of the war has begun. How should Ukraine define success as it seeks to repel Russian forces?


Do you find pop-up cases helpful?

We are looking for feedback from instructors!

If you have used a pop-up case in the classroom, please fill out our pop-up case survey or email us at [email protected] and let us know how it went. And be sure to follow us on Twitter at @Model_Diplomacy to hear about our most recent pop-up cases the moment they come out.

For Instructors

Pop-Up Case Guidelines View the Pop-Up Case Guidelines for some inspiration for how to structure your conversation.

Classroom handouts

PDF / 2.35 MB