A TRADE dispute between the world’s top two economies cut U.S. imports of Chinese goods by more than a quarter, or US$35 billion, in the first half of this year and drove up prices for American consumers, a U.N. study showed Tuesday.

China and the United States have been locked in a trade feud for the past 16 months although there are hopes that an initial deal offering some relief may be signed this month.

If that fails, nearly all Chinese goods imports into the United States — worth more than US$500 billion — could be affected.

U.S. imports from China subject to tariffs fell to US$95 billion between January and June from US$130 billion during the same period of 2018, the study released by the U.N. Conference on Trade and Development (UNCTAD) showed.

“Overall, the results indicate that the United States tariffs on China are economically hurting both countries,” the report said. “United States losses are largely related to the higher prices for consumers, while China’s losses are related to significant export losses.”

Over time, Chinese companies began absorbing some of the extra costs of the tariffs through an 8 percent dip in export prices in the second quarter of 2019, but that still left 17 percent “on the shoulders of U.S. consumers,” said the report’s author Alessandro Nicita, an economist at UNCTAD.

The sector hit hardest by the U.S. tariffs are U.S. imports of Chinese office machinery and communication equipment, which fell by US$15 billion. Over time, the scale of Chinese export losses increased alongside mounting tariffs, the study said.

Other countries stepped up to fill most of the gap left by China, the study found. Mexico increased exports to the United States by US$3.5 billion, mostly agriculture and transport equipment and electrical machinery. The European Union boosted deliveries by US$2.7 billion, mostly via additional machinery exports, it found. (SD-Agencies)