"The DPRK´s (North Korea´s) satellite launch as well as the possible nuclear test highlight the urgency and importance of settling relevant issues on the Korean peninsula," foreign ministry spokesman Hong Lei told reporters.[break]
"We hope all parties will bear in mind peace and stability of the Korean peninsula, exercise calmness and restraint and avoid actions that might escalate tension."
China backed a Security Council resolution passed Tuesday in response to last month´s long-range rocket launch. It expanded the list of North Korean entities on the UN´s sanctions list but stopped short of imposing new penalties.
The North reacted defiantly, vowing to strengthen its nuclear and missile capabilities and fuelling speculation about a possible third nuclear test.
China is the North´s sole major ally and its leading energy supplier and trade partner. It is seen as one of the few nations able to influence Pyongyang´s behaviour.
State media in China called for talks to resolve tensions, even after the North rejected dialogue on its atomic programme following the UN move.
"The ultimate way to restore lasting peace and stability on the Korean peninsula is to build trust among key parties through dialogue and consultation," the official Xinhua news agency said in a commentary.
Xinhua described the UN move as "a clear response to Pyongyang´s violation of Security Council resolutions, which the DPRK as a UN member should abide by".
"It is worth noting that the long-stalled six-party talks remain the most viable platform for dialogue," Xinhua said.
The talks are chaired by China and also involve the two Koreas, the United States, Japan and Russia.
The aim has been to entice Pyongyang to abandon its nuclear programme in exchange for aid and security guarantees, but the process has been moribund since the North abandoned the forum in 2009.
Beijing has long touted the talks as the best way to reduce tensions.
China´s UN envoy Li Baodong called Tuesday for greater diplomatic efforts to halt North Korea´s weapons programme, telling reporters there had to be new efforts to start "the diplomatic track and avoid the escalation of tension".
North Korea demolishes nuke test site with series of blasts