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Wang's remarks, made on a call to his Saudi Arabian counterpart Prince Faisal bin Farhan on Saturday, came as Israel appeared poised for a ground offensive against Hamas militants in Gaza.
"Israel's actions have gone beyond the scope of self-defense," Wang said according to a foreign ministry readout
"It should listen earnestly to the calls of the international community and the UN secretary general, and cease its collective punishment of the people of Gaza," he added in the strongest stance China has expressed so far on the conflict.
More than one million people in the northern part of the crowded enclave have been ordered to flee ahead of the expected assault, an exodus that aid groups said would set off a humanitarian disaster.
The cramped and impoverished territory, where 2.3 million residents live on top of each other, has been under a land, air and sea blockade since 2006.
After Hamas fighters broke through the heavily fortified border between the Gaza Strip and Israel to gun down, stab and burn to death more than 1,300 people, Israel launched a massive retaliatory bombing campaign targeting the Islamist group that has killed over 2,200 in Gaza.
Most of those killed on both sides are civilians.
Wang told Prince Faisal that "all parties should not take any action to escalate the situation and should return to the negotiating table as soon as possible."
Wang Yi also said in a separate call with US Secretary of State Antony Blinken on Saturday that Washington should "play a constructive and responsible role" in the conflict, and urged "the convening of an international peace meeting as soon as possible to promote the reaching of broad consensus".
- Spillover fears -
China's official statements on the conflict have not specifically named Hamas in their condemnations of violence, leading to criticism from some Western officials who said they were too weak.
The country's state broadcaster CCTV said on Sunday that China's special envoy Zhai Jun will visit the Middle East next week to push for a ceasefire in the Israel-Hamas conflict and promote peace talks.
Zhai "will visit the Middle East next week to coordinate with various parties for a ceasefire, to protect civilians, ease the situation, and promote peace talks," CCTV said in a video posted to its official social media account on Sunday.
Zhai said in an interview with CCTV that "the prospect of further broadening and outward spillover (of the conflict) is deeply worrying", according to the broadcaster.
Zhai met Friday with the Arab League's representatives in China and said Beijing supported the regional group "in playing an important role on the Palestine issue", according to a foreign ministry statement.
He told the bloc that Beijing would "make unremitting efforts to get the Middle East peace process back on track", the statement added.
© Agence France-Presse