WASHINGTON (REUTERS) - China needs to be a more responsible power as it gains global influence and avoid flexing its muscles in disputes with smaller countries over issues like the South China Sea, US President Barack Obama told CNN in an interview to be aired on Sunday (Sept 4).

Obama, who meets with President Xi Jinping at a Group of 20 summit next week in China, told CNN the United States supports the peaceful rise of China but that Beijing had to recognise that "with increasing power comes increasing responsibilities," according to excerpts released on Friday (Sept 2).

"If you sign a treaty that calls for international arbitration around maritime issues, the fact that you're bigger than the Philippines or Vietnam or other countries... is not a reason for you to go around and flex your muscles," Obama said.

"You've got to abide by international law."

China, a signatory to the UN Convention on the Law of the Sea, recently lost an arbitration dispute over the South China Sea. A court in the Hague found China had no historic title over the waters of the South China Sea and had infringed on the rights of the Philippines. Beijing has rejected the ruling.

Obama said Washington had urged Beijing to bind itself to international rules and norms to help build a strong international order.

"Where we see them violating international rules and norms, as we have seen in some cases in the South China Sea or in some of their behaviour when it comes to economic policy, we've been very firm," Obama told CNN.

"And we've indicated to them that there will be consequences."

The US President said China could not expect to "pursue mercantilist policies that just advantage" itself now that China has become a more affluent, middle-income country.

"Even though you still have a lot of poor people, you know, you can't just export problems. You've got to have fair trade and not just free trade," Obama said.

"You have to open up your markets if you expect other people to open up their markets."