Singapore's newly installed Prime Minister Lawrence Wong is set to maintain the city-state's policy of "hedge diplomacy" and neutrality in international relations and focus on sustaining its development, analysts said.

Wong was sworn in as the country's fourth prime minister at the Istana, Singapore's presidential palace, on Wednesday. A member of the fourth generation of the ruling People's Action Party leadership, Wong is expected to continue the party's established policies.

Mustafa Izzuddin, a senior international affairs analyst at Solaris Strategies Singapore, said he expects Wong to continue Singapore's current diplomatic position.

When it comes to the United States and China, this means "not choosing sides in superpower rivalry while practicing hedge diplomacy" to ensure "maximum economic benefits" for Singapore, he said.

Mustafa added that Wong is "a neoclassical realist" and sees both the U.S. and China as "important strategic partners".

Wong, as deputy prime minister and finance minister, said in a May 6 media interview that Singapore is neither pro-China nor pro-U.S..

"We are pro-Singapore," he said. Wong said the global order is shifting and that the U.S.' "unipolar moment has ended yet it remains a preeminent power in a world that is transiting to a multipolar world".

James Chin, a professor of Asian Studies at the University of Tasmania in Australia, said that with Wong at the helm, Singapore will continue to "see itself as the interlocutor between China and the U.S.".

Wong's ascent to the country's top post has happened at a "time of great crisis in the international arena", Chin said, adding Wong has to respond to the external challenges that Singapore is now facing, including conflicts in Europe and the Middle East, heated disputes over the South China Sea, and U.S.-initiated competition with China.

Oh Ei Sun, a senior fellow at the Singapore Institute of International Affairs, said Singapore's stance is representative of most member states of the Association of Southeast Asian Nations — neutral and adherent to ASEAN centrality.

Prime minister Lee Hsien Loong will remain in Wong's cabinet as a senior minister, while Wong will continue to serve as finance minister. Wong appointed Minister for Trade and Industry Gan Kim Yong as his deputy prime minister.

Rising costs

Analysts said while economic issues like the rising cost of living will remain a top concern for Singaporeans, Wong also needs to address the changing aspirations of the new generation of citizens.

Singapore's economic success has made it one of the world's most prosperous societies but younger Singaporeans want more in life than material success. This is set to be a key factor in a general election that will be held by 2025.

Mustafa of Solaris said Wong can respond to shifting domestic concerns by adopting an "engaging and consultative style more attuned with a newer generation of voters".

"Given the unpredictability of ground sentiments, the relatability of Wong to different segments of the population will be his greatest asset to ensuring that he garners a strong and healthy mandate from the people of Singapore in the next general election," he said.