BEIJING  - US Secretary of State John Kerry on Thursday denounced the “chilling effect” of Internet hacking on US businesses as he wrapped up two days of high-level talks with Chinese officials.

“Instances of cyber theft have harmed our business and threatened our nation’s competitiveness,” Kerry warned sternly in a joint closing session with his Chinese counterparts. “The loss of intellectual property through cyber (spying) has a chilling effect on innovation and investment,” he added, speaking after Washington indicted five Chinese military officers in May for hacking into US companies.

The issue was among many disputes and challenges discussed by the world’s two leading economic powers during the sixth annual Strategic and Economic Dialogue.

China insists that it too is a victim of hacking, and accuses Washington of hypocrisy since it conducts sweeping surveillance around the world. Leaks by former government contractor Edward Snowden have alleged widespread US snooping in China.

State Councillor Yang Jiechi said cybersecurity was a “common threat and challenge facing all countries”. “Cyberspace should not become a tool for damaging the interests of other countries,” Yang warned.

Despite pleas from the US side, Beijing did not agree to resume a cybersecurity working group which it suspended after the unprecedented indictments.

Kerry also said the two sides had agreed “on the importance and urgency of achieving a denuclearised, stable and prosperous Korean peninsula”.

They had discussed “specific ways” to ensure North Korea complies with its obligations, Kerry said, without giving details.

The two nations focused on trade and business concerns Thursday, with currencies and property rights topping the agenda.

“China and the United States represent the greatest economic alliance trading partnership in the history of humankind and it is only going to grow,” Kerry told a breakfast meeting of bosses from top Chinese and American companies earlier.

From small beginnings of about $2.5 billion in 1979 when formal diplomatic relations were established, annual trade between the two economic giants has now grown to a gargantuan $520 billion.

Direct foreign investment between the two has also ballooned, and last year for the first time the amount of investment flowing from China surpassed that from the United States.

“We want to do better,” the top US diplomat said.

But there have been a series of US-China trade disputes, while the United States has long insisted that the Chinese yuan, or renminbi, is artificially undervalued.

While the US has not branded China a currency manipulator, which could entail sanctions, it has complained that the weak yuan gives China an unfair trade advantage.

Treasury Secretary Jacob Lew said that China had “committed to reducing intervention as conditions permit”, and was “making preparations to adopt greater transparency including on foreign exchange, which will accelerate the move to a more market-based exchange rate”.

The CEOs of such companies as General Electric, Boeing, Fedex, Goldman Sachs and Silicon Valley Bank gathered for the working breakfast with counterparts from large Chinese firms including China State Construction Engineering Corporation, the Wanxiang Group, Dalian Wanda Group and the Shuanghui Group.

“Business is a backbone of the China-US economic relationship,” Yang told the breakfast meeting.

“Trade and investment between our business leaders, big businesses, not only brings goods and jobs to us but also mutual understanding and friendship among our peoples.”

US administration officials and lawmakers have repeatedly lambasted Beijing for failing to play by global rules, and the breakfast event was billed as a way for major companies from both nations to air difficulties and grievances they have encountered.

Lew said the two sides had “made progress on fostering greater competition over the past two days.”

And they had “made concrete progress that will create new opportunities for US workers and companies in an expanding Chinese market.”

Earlier this month the World Trade Organization called on China to make its trade policies more transparent amid a “striking” lack of clarity on its rules.

China, which recently become the largest trader in the 160-member group, has failed to live up to key transparency commitments it made when it joined the organisation in 2001, WTO members said.