Hagel called for China to work with the United States to establish a cyberspace code of conduct.


“The United States has expressed our concerns about the growing threat of cyber intrusions, some of which appear to be tied to the Chinese government and military," said Hagel. "As the world’s two largest economies, the U.S. and China have many areas of common interest and concern, and the establishment of a cyber working group is a positive step in fostering U.S.-China dialogue on cyber. We are determined to work more vigorously with China and other partners to establish international norms of responsible behavior in cyberspace.” 


The Shangri-La gathering is meant to be a venue for nations to come together and talk about common solutions to security issues in the region. 


It was also a chance for Hagel to reassure its partners that despite Washington's budget problems, the Obama administration's strategy of rebalancing its military focus to the Asia Pacific remains on track. Part of that plan is to shift 60 percent of the the U.S. Navy's assets to the Pacific by the year 2020, as well as moving additional combat aircraft to the region and a fourth fast-attack submarine to the U.S. Pacific territory of Guam. 


The strategy does not sit well with Chinese leaders, who see it as a military buildup aimed at containing China's growing influence in the region. A member of the Chinese delegation in the audience, Army Major General Yao Yunzhu, questioned the U.S. defense secretary after his speech. 


“U.S. government officials have on several occasions clarified that rebalance is not against China," said Yao. "However, China is not convinced.” 


Hagel's reply: the United States wants to see China as a partner who contributes to peace in the region. 


“I said in my statement here this morning that we welcomed a strong and emerging and responsible China," said Hagel. "We do, as I said that about other nations, about India and Indonesia and other nations. And we do. We look forward to that emergence for many reasons but one as among them all is as important as any other and that's the new responsibilities that great nations take on, responsibilities for security in their region.”


One of the areas where the U.S. sees a need for greater cooperation from China is on North Korea, which recently stepped up its threats to attack South Korea, Japan and the United States.


China is North Korea's closest ally.


In his remarks Saturday, Hagel said no country should conduct “business as usual” with Pyongyang. He said the United States will not stand by while the North seeks to develop a nuclear-armed missile that can target the United States.




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Hagel Gives Blunt Warning to China on Cyber Attacks