New Prime Minister Malcolm Turnbull has delved into the controversial and highly charged debate over China's actions in the South China Sea, saying the world power is "pushing the envelope".

Mr Turnbull was questioned about his foreign policy objectives on the ABC's 7.30 program.

Key points: PM says China's actions in South China Sea push the envelope

PM says China's actions in South China Sea push the envelope Foreign policy analyst Michael Fullilove foreshadows different approach to China relationship under Turnbull

Foreign policy analyst Michael Fullilove foreshadows different approach to China relationship under Turnbull Dr Fullilove also embraces idea of Joe Hockey taking over as US ambassador

He said the rise of China should not disturb the harmony of the region, and laid bare his own views about the way the regional power should behave.

"The pushing the envelope in the South China Sea has had the consequence of exactly the reverse consequence of what China would seek to achieve," he said.

"My own view and the Government's view is that China would be better advised, in its own interests frankly, not to be pushing the envelope there and that is why there's been resistance against that activity."

Mr Turnbull said the Government needed to take a diplomatic and balanced approach to China.

He said smaller countries in the region like Vietnam have been drawn closer to the United States as a result of China's position.

"You would think what China would seek to achieve is to create a sufficient feeling of trust and confidence among its neighbours that they no longer felt the need to have the US fleet and a strong US presence in the western Pacific," he said.

Turnbull is 'alert to the upside of China'

A leading Australian foreign policy analyst has foreshadowed a different approach to the relationship with China under Mr Turnbull.

Mr Turnbull flagged his interest in developing closer ties with Asia soon after taking the leadership.

"We are sitting here in Asia. We are a multicultural society. We are a highly educated society. We have the capacity to be more innovative, more productive," he told Channel Seven earlier this week.

"This is the Asian Century or the Pacific Century and we are perfectly positioned in it."

Executive director of the Lowy Institute for International Policy Michael Fullilove interpreted it as a change in tone.

"I think he's very alert to the upside of China," he told Lateline last night.

"Mr Abbott was more focused on the downside. I think he's more optimistic, whereas Mr Abbott was more pessimistic.

"His primary responsibility probably is to protect the security of Australia broadly defined, so we'll see if that changes some of his attitudes to China and other issues."

Hockey would suit 'backslapping' Washington

Dr Fullilove also embraced the idea of former treasurer Joe Hockey taking over as US ambassador.

Mr Hockey will step out of politics after being dumped from the senior role by Mr Turnbull.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Watch Duration: 10 minutes 27 seconds 10 m Michael Fullilove talks to Lateline

Mr Turnbull has not ruled out delivering him the plum appointment which will become vacant later this year.

"I think he'd do well because it's a city where - I mean, he's a likeable character and it's a city where backslapping is a way of life. He's a senior politician and it's a town where seniority matters," Dr Fullilove said.

"And he's moderate politically and it's a city where there are as many Democrats as Republicans and where the Democrats may well retain their hold on the White House. So, I think that he has some attributes to recommend him."

Former leader Tony Abbott's foreign policy approach came in for praise, particularly the approach to the shooting down of MH17 and the relationship with Russia, as well as diplomacy in New York.

"I think one of the positive elements of Mr Abbott's foreign policy was that he was ambitious and he felt that Australia should play a meaningful role in the world," Dr Fullilove said.