U.S. Secretary of State Hillary Clinton met Myanmar President Thein Sein on Friday for landmark discussions days after Washington eased its sanctions on the once-pariah state.
The pair held talks in the Cambodian tourist town Siem Reap on the sidelines of a U.S. business conference, after the U.S. on Wednesday gave the green light to firms to invest in Myanmar, including in oil and gas, in its greatest loosening of tough sanctions so far.
It is Clinton's second meeting with Thein Sein after she became the first U.S. secretary of state to visit Myanmar in half a century during a trip to the country late last year, as reforms took hold in the long military-dominated nation.
Washington has faced criticism from rights groups concerned it is moving too fast in its eagerness to cash in on Myanmar's vast business potential.
But the decision will please U.S. firms eager not to miss out on what some economists expect to be a gold rush in the resource-rich nation.
Asian firms have been doing business in Myanmar for years, while the European Union suspended most of its sanctions against the country in April.
Clinton told Thein Sein that the U.S. wanted to encourage further reforms in the country, which has impressed the West with its release of hundreds of political prisoners and by welcoming opposition leader Aung San Suu Kyi and her party into mainstream politics.
"We want to help you keep going. We are very committed," she said.
Thein Sein hailed the U.S. decision to ease its investment embargoes.
"I am very pleased to see our bilateral relationship improving dramatically," said the Myanmar leader, a former general who shed his army uniform when he took power as the head of a quasi-civilian government last year.
The meeting, which lasted about an hour, raised a host of issues including political prisoners, environmental protections and the plight of the country's stateless Muslim Rohingya, officials said.
"They were talking seriously about how to take the country forward on its reform goals, on its investment goals," a senior State department official said.
Thein Sein on Thursday told the U.N. that refugee camps or deportation was the "solution" for the Rohingya, following communal violence last month in western Myanmar, in comments likely to alarm Western nations.
In a speech earlier on Friday Clinton acknowledged that in Myanmar as it opens up "there will be a lot of challenges" but said she hoped to see "continuing progress there".
Washington was setting up "protections to ensure that increased American investment advances the reform process" she said, because U.S. firms will have to report on transparency and labor rights.
Myanmar -- along with regional neighbors -- has called for all sanctions to be lifted as the country embarks on its "second wave" of economic reforms.
Democracy icon Aung San Suu Kyi welcomed the sanctions decision, but called for greater transparency at state-owned Myanma Oil and Gas Enterprise, which U.S. firms will be able to do business with under the new rules.
Her comments were echoed by influential U.S. Senators John McCain and Joe Lieberman, who said operations at the organization "remain non-transparent and the billions of dollars in foreign investment that it receives remain unaccountable to the people and parliament of Burma".
Human Rights Watch went further, saying Washington had "caved to industry pressure" because it did not insist on reforms in governance and human rights.
Left impoverished by decades of economic mismanagement and isolation under army rule, the country is seen as the next big frontier in Asia for firms wanting to take advantage of its resources, cheap labor force and strategic position between China and India.
Thein Sein told the Singapore Straits Times his country would sign up to an Oslo-based initiative to enhance transparency of payments in the oil and minerals sector.
A high-level group of U.S. business leaders will be visiting Yangon and the capital Naypyidaw in the coming days.
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