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When you have Database instance in AWS i.e. RDS, you will never be granted the FULL blown Admin as this could be used to elevate access to the underlying operating system.
Please see the table in the link of the Maximum privilege that your master user will be grated. You may NOT grant any access higher than what the master user is granted. You can see in your error message that you cant alter SYSTEM access.. This is because AWS does not allow SYSTEM to be altered.
https://docs.aws.amazon.com/AmazonRDS/latest/UserGuide/UsingWithRDS.MasterAccounts.html
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