'Rare earths controls vs 100%% tariffs' Economic chiefs talk amid U.S.-China conflict…Could this be a breakthrough for improving relations?

Besent "Had a frank conversation, in-person talks next week"

China "Constructive exchanges on important economic and trade issues"

Amid escalating U.S.-China tensions over China's tightened controls on rare earth exports and the U.S.'s announcement of 100% additional tariffs on China, the economic chiefs of the two countries have engaged in communication.

Scott Besent, U.S. Treasury Secretary, said on the 17th (U.S. Eastern Time) at the U.S.-Ukraine summit held at the White House, "My interlocutor, (China's) Vice Premier He Lifeng, and I plan to speak tonight around 8:30–9:00 (by phone)," adding "Afterwards, he and I, and the (U.S.-China) delegations will probably meet in Malaysia between tomorrow and a week from now to prepare for the leaders' meeting."

Secretary Besent said, "I think tensions have eased. I hope China will show us the same respect we have shown China," and "I am confident that President Trump, thanks to his relationship with President Xi Jinping, can set this situation back on a good course."

With consideration being given to a meeting between President Trump and President Xi Jinping in Korea on the sidelines of the Asia-Pacific Economic Cooperation (APEC) leaders' meeting opening in Gyeongju on the 31st, Secretary Besent and Vice Premier He agreed to meet in advance to coordinate the agenda for the leaders' summit.

Xinhua News Agency reported that U.S.-China representatives first held a video call. The outlet explained, "At Beijing time on the morning of the 18th (U.S. Eastern Time on the 17th), China's Vice Premier of the State Council and lead for economic and trade matters, He Lifeng, had a video call with U.S. lead representatives, Treasury Secretary Besent and U.S. Trade Representative Jamieson Greer (USTR)."

It added, "Both sides placed the implementation of important agreements made by the two leaders in their calls this year at the center of discussion, and held frank, in-depth and constructive exchanges on major issues in bilateral economic and trade relations," and said "They agreed to promptly hold new China-U.S. economic and trade negotiations."

Secretary Besent also said on social media after the call with Vice Premier He, "We had a frank and detailed discussion about U.S.-China trade issues," and "We will meet in person next week to continue discussions." This again referenced the planned Malaysia meeting between the U.S. and Chinese economic chiefs mentioned earlier.

Secretary Besent and Vice Premier He played a role as a communication link during the bilateral tensions after the U.S. and China started a 'tariff war' in April by imposing ultra-high tariffs exceeding 100% on each other and then reached a de facto 'truce' agreement through negotiations.

Accordingly, observers say the scheduled calls and meetings between the two economic chiefs could be a sign of improving recently strained U.S.-China relations.

Park Su-rim, Hankyung.com reporter paksr365@hankyung.com