Diplomacy is the fine art of working with other major races and minor factions throughout the galaxy. Various diplomatic actions can be taken to foster or hinder good relations with your galactic neighbors.
Factors affecting diplomacy
There are no perfectly rational beings in the galaxy; cooperation must be earned. There are numerous factors that determine the other races’ or factions’ approach to you. Any innate characteristics of your civilization (predisposing the other party towards you or the opposite), chosen ideology, your power (both actual and potential), and more are all factored into the approach.
Military Power Rating
Your and the AI's military rating is based entirely on the total attack power of all your ships. The size of ships, hit points, defenses, speed, range, are not considered. Neither are weapons' range or rate of fire.
A low military rating can be a great disadvantage in diplomacy, so even when not acting aggressively you need ships to be seen as equals, or possibly to gain an advantage in negotiations without intending to actually use your military. This is sometimes called Gunboat Diplomacy.
The easiest way to build military strength is with smaller ships with multiple weapon types, combined with military starbases. Military starbases add attack power to any of your ships in range as long as they have that weapon type already equipped. Also since it gives a flat bonus to every ship this means multiple smaller ships gain more than fewer larger ships. So the ideal ship to boost military rating is a tiny ship with all three weapon types. This won't be possible until technology allows you to fit more weapons into smaller hulls, so you may need switch between tiny an small ships, using whichever of the two can currently hold the most out of the three weapon types. But tiny ships are best both in efficient use of logistics and maintenance cost, which is zero.
While your power rating will be high, this does not mean you will necessarily fare well in a war. This is known as being a Paper Tiger. Your ships pack a punch, but won't last long and can't move well. Ships with more focused designs using support modules and with escorts to draw fire and engines and life support to get to targets will be more combat effective.
Diplomatic states are a part of diplomacy defining the current formal relationship between you and the other civilization.
Treaties are formalized commitments that have a large impact on relations with the other civilization.
Treaty Types and Effects
Declare War - Go to war with another civilization.
Peace - End the war between two civilizations.
Alliance - Vow to support an ally’s side in any war and form an alliance with them.
Embargo - Refuse the establishment of trade routes and severe existing trade routes with a third party’s civilzation.
Declare War on Another Civilization - Go to war with a third party’s civilization
Open Borders - Allow each other’s ships to pass through your respective territories without diplomatic penalty.
Exploration - Share each other’s sight in the fog of war.
Non-aggression - A civil pact that prevents each party from declaring war on the other.
Cultural - Give a 10% bonus to influence for the other culture per turn through the sharing of culture.
Free Trade - Give a 5% bonus to colony research and wealth generation to the other civilization through the sharing of markets.
Slave - Give a 5% bonus to colony manufacturing and wealth to the other civilization by agreeing to open slave markets.
Strategic Resource - Allow the other civilization to use some of a strategic resource.