This paper examines digital partnerships, alliances, and policy dialogues as foreign policy tools of the European Union in an international environment increasingly shaped by geopolitical and geoeconomic competition. It argues that these instruments should not be treated as merely technical frameworks for cooperation, but as part of the EU’s broader effort to manage dependencies, expand influence, and shape external governance environments in strategic technological domains. The paper uses regulatory mercantilism as its main analytical approach. This framework is better suited than Normative Power Europe or the Brussels Effect to capture how regulatory agendas, standards, connectivity projects, and innovation cooperation are combined in support of wider diplomatic and strategic objectives. Empirically, the paper focuses on the EU–LAC Digital Alliance. This is a relevant case because it allows the analysis of EU digital diplomacy beyond the neighborhood and outside accession dynamics, in a region where regulatory alignment, connectivity, and external influence are increasingly important and contested. Methodologically, the paper develops a qualitative case study based on manual analysis of key policy documents, selected interviews, and secondary sources. The paper contributes to current debates on the redefinition of EU diplomacy in a fragmented order by showing how digital cooperation is increasingly linked to questions of strategy, resilience, and geoeconomic positioning.