US Vice President Joe Biden has urged China to end its "outright" theft through hacking and to improve human rights as the world's two largest economies began annual strategic talks.
Biden opened two days of talks titled Strategic and Economic Dialogue on Wednesday with China in which the Pacific powers are expected to address a gamut of issues including mutual complaints of market access.
While many experts expect the session to be a talking shop without major decisions, Biden did not shy away from divisive rows including charges of cyber-espionage.
"We both will benefit from an open, secure, reliable Internet. Outright cyber-enabling theft that US companies are experiencing now must be viewed as out of bounds and needs to stop," Biden said.
A recent US study said that corporate America was losing hundreds of billions of dollars a year through a vast, organised hacking campaign to steal US trade, government and military secrets.
China has hit back that it is also the victim of hacking, charges that gained momentum when US intelligence leaker Edward Snowden said that US spies had broken into the billion-plus nation's Internet routing network.
Human rights concerns
Biden brought up China's tense territorial disputes with its neighbours, saying that both Pacific powers "benefit from freedom of navigation and uninhibited lawful commerce."
He also raised concerns about human rights in China, saying that greater respect for one's own people provides "a source of national and international stability".
"I believe that China, presumptuous of me, will be stronger and more stable and more innovative if it represents and respects the international human rights norms. But there are differences we have," Biden said.
State Councilor Yang Jiechi, a top figure behind China's foreign policy, told the talks that Beijing was ready to discuss human rights but "on the basis of equality and mutual respect."
Tibet activists have urged the United States to raise China's treatment of the community.
More than 110 Tibetans have set themselves alight since 2009 to protest Chinese rule and overseas groups say that Chinese forces opened fire on Saturday on Tibetans marking the birthday of the Dalai Lama, their exiled spiritual leader.
But both US and Chinese officials sought to keep an upbeat tone, voicing hope that the two nations can keep building trust following a friendly, informal summit last month between US President Barack Obama and his new Chinese counterpart Xi Jinping.
Biden warned that "strong voices on both sides of the Pacific" see ties between the United States and a rising China "in terms of mistrust and suspicion."
"I've heard the US-China relationship described as everything from the next Cold War to the new G-2 and, the truth is, neither are accurate," Biden said.
"Our relationship is and will continue to be, God willing, a mix of competition and cooperation. And competition can be good for both of us, and cooperation is essential," he said.
Yang called China a "responsible" country that has worked with the United States on the international financial crisis and in the "fight against terrorism".
"There are many common interests between us, as well as some friction and difficulties. However, our common interests far outweigh our differences," he said.