Ambassador having friendly relations with European poet (5)
I believe the answer is:
heine
'poet' is the definition.
(German poet Heinrich Heine)
'ambassador having friendly relations with european' is the wordplay.
'ambassador' becomes 'he' (His or Her Excellency).
'having friendly relations' becomes 'in' (as in being 'in' with a group of people).
'with' means one lot of letters go next to another.
'european' becomes 'E' (abbreviation e.g. EU).
'he'+'in'+'e'='HEINE'
(Other definitions for heine that I've seen before include "Heinrich -, nineteenth century German poet" , "Heinrich -, Ger. poet" .)