A top EU official held out the prospect of a further easing of sanctions on Myanmar during a meeting on Monday with a senior member of the new civilian administration and announced increased aid to acknowledge reforms already begun.
In a meeting that a handful of journalists were, unusually, allowed to attend, European Commissioner for Development Andris Piebalgs told house speaker Thura Shwe Mann it was important that parliament became an active player in the reform process.
The former Burma was ruled by the military for almost 50 years until elections in November 2010, and its new parliament is dominated by military personnel and an army-backed party.
But by-elections on April 1 should see more opposition members voted in, including Aung San Suu Kyi, a Nobel Peace laureate and long-time campaigner for democracy.
Commissioner Piebalgs noted the European Union had already softened its sanctions.
"Some restrictions were suspended because we recognised the changes in the country. For this reason the by-elections are a crucial process," he said.
Shwe Mann, number three in the former junta and a pivotal figure in the new administration, said he would be happy to see Suu Kyi's National League for Democracy (NLD) in parliament. The party swept a 1990 election but the military ignored the result. It boycotted the 2010 election.
"We have established a parliament, taking the necessary actions for democracy to thrive in Myanmar. The NLD and other parties, if they win in the by-elections, they can be in parliament. We will welcome them," he told Piebalgs.
The European Union and the United States have also said the freeing of political prisoners was crucial to the resumption of full diplomatic and economic links.
Last month, the European Union eased sanctions slightly when its Foreign Affairs Council agreed to temporarily lift travel bans on President Thein Sein and top government officials in response to ceasefire deals with ethnic minority rebels and a fourth prisoner amnesty on Jan. 13, when about 300 political detainees were freed.
Estimates vary on how many remain behind bars, but Shwe Mann suggested there could be further amnesties after an official review.
"The remaining political prisoners are those who have committed criminal activities in this country. Those who are on that list, if they have been involved in terrorist activities or harmed the public, they will not be included," he said.
Later, Piebalgs became the most senior EU representative to meet President Thein Sein.
He has announced a 150 million euro ($198 million), two-year aid package to help Myanmar reverse decades of stagnation because of international isolation and inept military rule.
The European Union is leading the way in trying to support a country badly in need of new infrastructure and health and education facilities. To illustrate the stepped-up commitment, its new aid package is worth almost as much as the 173 million euros it has given the Southeast Asian country since 1996.
That aid concentrated on health and education, but the new package also aims to find resources for people displaced by conflict and for agriculture, which provides a living for many of the country's estimated 60 million people.
Some diplomats from EU member states believe the bloc will lift more sanctions as the year goes on, moving earlier than the United States, which is also positive about the changes but has a stricter sanctions regime that could take longer to undo.
The European Union's annual sanctions review will take place in April, after the April 1 by-elections for 48 legislative assembly seats.
The government, which is anxious to see the sanctions scrapped, pulled out all the stops to allow Suu Kyi to run. It hopes her presence will add legitimacy to a parliament that is becoming more vocal but still has only limited powers.
Piebalgs will meet Suu Kyi at her home in the former capital, Yangon, on Tuesday.
"The release of prisoners and, if it ends up being the case, free elections in April, will be used as motivation for the EU to prove that engagement 'works'," said Joakim Kreutz, a researcher at Sweden's Uppsala University and an expert on Myanmar sanctions.
"I still expect the arms embargo and some personal sanctions on junta veterans to remain, but I would not be surprised if some measures are lifted."
Western businesses constrained by the sanctions are quietly showing interest in Myanmar for its natural resources -- oil, gas, timber and gemstones -- and are also looking to invest in tourism, financial services, hotels, telecommunications networks and infrastructure.
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