The European Union - United States trade dispute over bananas and its implication for future trade dispute settlements

The purpose of this study is to explain the significant change in the policy position of the European Commission in April 2001 to make the Common Market Organization for bananas compliant with World Trade Organization rules for the conduct of trade. The thesis (1) contrasts trade decision-making processes in the European Union and the United States; (2) applies Putnam's two-level framework and Allison's governmental politics model to identify factors that explain the resolution process; (3) develops a framework for transatlantic conflict management; and (4) discusses implications for the transatlantic trade relationship.; The research indicates that differences in the decision-making processes are underlying factors that caused the banana dispute to escalate. Eight factors that contributed to the resolution ranging from personnel changes to ‘banana fatigue’ are identified. From these, a conflict resolution and prevention strategy is derived that identifies the political will to reach a negotiated agreement as centerpiece for conflict resolution and prevention in transatlantic trade matters.