The global economy is being threatened by rising protectionism and risks of high leverage are accumulating, Chinese President Xi Jinping said at the open of a two-day summit of leaders from G20 nations.
His warning on Sunday followed bilateral talks with Barack Obama that the US president described as "extremely productive", but which failed to bring the two sides closer on thorny topics such as tensions in the South China Sea.
With the summit tucked in between Britain's surprise vote in June to exit the European Union and the US presidential election in November, G20 leaders are expected by observers to mount a defence of free trade and globalisation and warn against isolationism.
But some of the G20 leaders have begun drawing battle lines in disputes over issues ranging from trade and investment to tax policy and industrial overcapacity.
The global economy is "at a crucial juncture", Xi said, hemmed in by sluggish demand, financial market volatility and feeble trade and investment.
"Growth drivers from the previous round of technological progress are gradually fading, while a new round of technological and industrial revolution has yet to gain momentum."
Other leaders attending the summit in the eastern Chinese city of Hangzhou include Russia's Vladimir Putin, Japan's Shinzo Abe, Britain's Theresa May, Germany's Angela Merkel, France's Francois Hollande and India's Narendra Modi.
Security was extremely tight in Hangzhou, with parts of the city of nine million people turned into a virtual ghost town as China seeks to ensure that the G20 summit is incident-free.
Obama, who arrived on Saturday, held talks with Xi that ran late into the night. He urged Beijing to uphold its legal obligations in the disputed waters of the South China Sea, and stressed US commitments to its regional allies.
Xi said China would continue to safeguard its sovereignty and maritime rights in the South China Sea.
But China is keen to keep the summit focused on economic issues and to prevent other disputes from overshadowing it.
European Commission President Jean-Claude Juncker said China must set up a mechanism to address its problem of industrial overcapacity, saying it was "unacceptable" the European steel industry had lost so many jobs in recent years.
"Overcapacity is a global problem but there is a particular Chinese element," he told a news conference.
Britain's future after its departure from the European Union was also subject to discussion.
Obama reassured Prime Minister May that Britain's closest political, commercial and military ally would stand by her, but did not shrink away from his stance that Brexit was a mistake and that London would not be able to jump the queue to arrange a bilateral deal.
Juncker said if Britain wanted access to the European Union's common market, it needed to respect the rules of the common market.