[2] Huge profits from Asian spices led to conflict even in times of peace, as the Dutch East India Company, or VOC, first created, then enforced, their monopoly over production and trade.

In August 1664, the English occupied New Netherland, later renamed New York; when another attack captured WIC slave trade posts in modern Ghana, the Dutch sent a fleet to recapture them.

[7] Despite the Franco-Dutch treaty of April 1662, Louis XIV initially remained neutral, as French and Dutch economic interests increasingly diverged over the Spanish Netherlands.

In contrast, the Dutch economy had largely recovered from its post-1665 contraction, while public debt was lower in 1667 than 1652; however, naval warfare was enormously expensive and financing it a challenge even for the Amsterdam markets.

[14] In October 1666, Charles opened discussions with the States-General of the Netherlands, under the pretext of arrangements to return the body of Vice-Admiral William Berkeley, killed in the Four Days' Battle.

He invited the Dutch to negotiations in London and withdrew previous demands for the appointment of his nephew William of Orange as stadtholder, payment of damages, the return of Run and a trade deal on India.

The States-General refused to attend peace talks without France; on territorial claims, they offered to continue the present situation, or revert to the position before the war, an option clearly unacceptable to the English.

Louis agreed to ensure the Dutch complied with English demands, in exchange for a free hand in the Spanish Netherlands; by April 1667, diplomats in The Hague were predicting a deal was imminent.

[16] Grand Pensionary Johan de Witt and the States of Holland rejected English proposals to negotiate in The Hague, a town dominated by the Orangist opposition.

'[18] The parties eventually settled on Breda, but French military preparations led the Orangists to accuse De Witt of deliberately stalling to allow Louis a free hand in the Spanish Netherlands.

[20] The role of mediator in peace talks provided prestige and the opportunity to build relationships; since Louis and Leopold both wanted the position, they compromised by using Swedish diplomats.

[21] Key players in the vital Baltic trade in grain, iron and shipping supplies, the Swedes hoped to remove commercial concessions imposed by the Republic in the 1656 Treaty of Elbing and end its alliance with Denmark.

Backed by assurances from Louis that he would force the Dutch to agree concessions, the English increased their demands and Van Beverningh told De Witt a major military victory was needed to improve their bargaining position.

[27] Holles and Coventry initially assumed this would extend negotiations, but the need to create an alliance against France meant Spain threatened to withhold implementation of the Madrid treaty, supported by Leopold.

Combined with economic losses caused by the war and the Great Fire of London, Clarendon instructed Holles to agree terms "to calm people's minds" and "free the king from a burden...he is finding hard to bear".

[29] A separate treaty amended the Navigation Acts; goods transported along the Rhine or Scheldt to Amsterdam could be carried by Dutch ships to England without being subject to tariffs.

[35] By exchanging New Netherland and Run, Breda removed two major areas of dispute, reducing Anglo-Dutch tensions overall and clearing the way for the 1668 Triple Alliance between the Republic, Sweden and England.

[37] In the longer term, Breda was the point when the English and Dutch came to view France as a greater threat than each other; whilst Charles' preference for a French alliance led to the 1670 Secret Treaty of Dover, the long-term trend was against him.