I've heard it many times. I searched the web and dictionary and found two meanings.
An official engaged in international negotiations (this is clear to me).
A person who deals tactfully with others (unclear).
We often say Ah! Come on...stop being a diplomat. Does it mean that we want the other person to be clear and straightforward (but then it's a bit negative) without playing with words? Does this word, by any means, refer to cunningness?