Beyond simple trading of basic resources, and the bonuses from tech and trade treaties, there really is no Diplomacy in LH currently. Factions of your own alignment will tend to be friendly, as long as you don't build the Tower or get too close to them, or accept one of their countless offers of tribute, and factions of opposite alignment may be friendly early in the game when your borders are distant, but will eventually turn hostile, the quicker if you're weaker.
