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Are there any requirements I need to fulfill before I can start conducting diplomacy?
Yes. To engage in diplomatic talks with another civ, you must first make contact with that civ. You can do this either by physically entering their territory or by trading another civ for contact with that civ. Other Civs may also seek you out by entering your territory. You also need to establish an embassy (granted by the writing technology) to be able to enter into agreements more advanced than simple peace treaties. To be able to enter into trade negotiations with other civs, you need a road connecting one of your cities to one of their cities. To exchange world maps, you need the technology of map making.
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Finally, you must be at peace with a Civ to tender any proposal other than a peace treaty.
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So...what if you want to negotiate a settlement before peace? IE - you give me 200 gold and Veii and we'll sign a peace treaty. If you sign the peace treaty first, they may not give you the things you want. Sure you can go to war with them again, but it lowers your trust among other nations and still doesn't accomplish anything. Does anyone have more info on this?
I posted this for orange because he's had some trouble getting on.