"We do think that there is increasing convergence, both at the G7 and at NATO, around the challenge China poses," Sullivan told reporters at the G7 summit in southern Germany.

G7 leaders saw an "urgent need" for consultation and alignment on issues such as China's non-market economic practices, its practices with regard to developing countries' debt, and its approach to human rights, Sullivan said.

But he said the increased attention to China's actions on both the economic and security front did not mean the West was looking to launch a new Cold War.

"We're not looking to divide the world into rival blocs and make every country choose" he said. "We want to stand for a set of principles that are fair to everybody. And we want to ensure that we're working with like-minded partners to hold China accountable to adhere to those rules."

G7 leaders on Sunday pledged to raise $600 billion in private and public funds over five years to finance needed infrastructure in developing countries and counter China's older, multitrillion-dollar Belt and Road project.

Biden and other G7 leaders launched the newly renamed "Partnership for Global Infrastructure and Investment" to support projects in low- and middle-income countries that help tackle climate change as well as improve global health, gender equity and digital infrastructure.