The Collaborative International Dictionary of English v.0.48:

Statecraft \State"craft`\ (st[=a]t"kr[.a]ft`), n.
   The art of conducting state affairs; state management;
   statesmanship.
   [1913 Webster]

WordNet (r) 3.0 (2006):

statecraft
    n 1: wisdom in the management of public affairs [syn:
         statesmanship, statecraft, diplomacy]