What does Genesis 34:16 mean?

In the previous verse, Jacob's sons had given the one condition upon which they would allow Dinah's rapist Shechem to marry their sister (Genesis 34:1–12). Their stipulation is that every man in Shechem's community must be circumcised. The deception is that this will make Shechem's family acceptable to the sons of Jacob and the two people groups can then intermarry. However, that condition was given as part of a deceitful scheme hatched to take revenge on Shechem (Genesis 34:13).

During these negotiations, Shechem's father Hamor spoke of free trade and intermarriage between Jacob's people and his own. That diplomatic appeal was probably Hamor's recognition that a wealthy and powerful family like that was not one to make enemies with. If Jacob's people would freely intermarry with Shechem's people, they would soon became a single group. This, of course, was never an option for Israel (Genesis 24:1–4). Hamor and Shechem don't know this, and they're happy to get an agreement that seems to avoid bloodshed (Genesis 34:18).