China's leaders focus inward, wary of distraction

China's leaders face daunting domestic problems and would be wary of any foreign entanglement, and the growth of its military was a reflection of its rise as an economic power, Singapore's foreign minister, K. Shanmugam, said on Tuesday.

President Xi Jinping and other new leaders of China's 1.3 billion people need to restructure the economy to rely more on consumption, clean up the environment and tackle rising income inequality, he said.

"The Chinese leadership know the last thing they need is an external distraction," Shanmugam told Reuters in an interview.

The new leaders of China, who have taken over after a once-in-a-decade reshuffle, are being scrutinized by outside powers as growing economic and military influence propel it to superpower status.

The relationship between the United States and China would define how Asia develops, Shanmugam said.

They have recently exchanged angry accusations over computer hacking, while China, Japan, Vietnam and the Philippines have conflicting claims over various groups of islands.

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