I have also played Sweden. My experience with diplomacy has been mixed. If you follow the instructions on the tutorial and send a diplomat there not to do any negotiations but just to reside there for a while, and you check the diplomacy screen every now and then and wait for the attitude to change from indifferent to the next step up, there is a reasonable chance you will get a trade deal. Send a merchant and start trading. After a while the attitude will change to something like respectful. Try getting an alliance at that point. Although for me they sent a diplomat to me and I got an alliance that way.
I have had two problems with sending diplomats. One is that I usually only want them to reside there rather then bring up the negotiation screen. I wish they would change it so that there is an option on the negotiation screen that allows you to simply not negotiate and continue residing there. But once the negotiation screen comes up you either have to successfully negotiate something or you are out of luck. I really don't like that and it makes the whole diplomat thing incredibly iffy and expensive.
Secondly, when they send a diplomat to you and then don't allow you to accept what they are offering, I consider that just plain nonsense.
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