The incipient (i)________ regarding taxes could affect trade between the two countries much more than the (ii)________ banana imports, which has been going on for years. Unfortunately, the trade regulators seem to be ignoring both disagreements.
The fact that the both issues are referred to as disagreements, shows that the words for the blanks should be negative ones.
For the first blank, we can eliminate accord, which means agreement and expresses the exact opposite sentiment we are looking for. The word investigation is a neutral word, and is not a negative word.
Thus the correct choice is row, which actually means a serious dispute, and hence is almost a synonym of disagreements.
For the second blank, there are two negative choices, predicament regarding and festering dispute over.
The fact that the second issue has been going on for years makes us choose festering dispute over. A festering dispute is one which becomes worse or intense especially through long-term neglect or indifference.
A predicament is a difficult, unpleasant, or embarrassing situation. It is a disagreement. But it does not carry the sense of existing for a long period of time.