May 18 (Bloomberg) -- The U.S. government loosened a ban on American investments in Myanmar in the strongest acknowledgment yet of the political and economic transformation put in motion by a new government of former army generals.
Along with the easing of trade and investment restrictions, President Barack Obama announced he’s nominating Derek Mitchell as the first U.S. ambassador to Myanmar in 22 years.
“The United States remains concerned about Burma’s closed political system, its treatment of minorities and detention of political prisoners, and its relationship with North Korea,” Obama said in a statement released by the White House yesterday.
In a sign that the administration is still treading with caution, a ban remains on doing business with companies linked to the military.
The Southeast Asian country, also known as Burma, is shaking off a half century of isolation after April 1 elections, the most inclusive since 1990, allowed the country’s leading dissident, Daw Aung San Suu Kyi, to take a seat in parliament. She had spent 15 of the past 22 years under house arrest.
Myanmar President Thein Sein is courting investment from Japan amid a shift toward democracy over the past year that’s encouraged re-engagement with developed nations. General Electric Co. is among companies expressing interest in Myanmar, a nation of 64 million people.
Myanmar Official Visits
Secretary of State Hillary Clinton yesterday met with Myanmar Foreign Minister U Wunna Maung Lwin, the first member of the cabinet to be formally invited to visit Washington in decades. In a speech, she urged American businesses to invest in Myanmar responsibly.
“We’ll expect U.S. firms to conduct due diligence to avoid any problems, including human rights abuses,” Clinton said, according to a transcript of her remarks e-mailed by the U.S. Department of State. “We expect our businesses to create a grievance process that will be accessible to local communities.”
Obama said there has been progress toward democracy, including the release of “hundreds” of political prisoners, pursuit of cease-fire talks with several armed ethnic groups, and talks with Burma’s leading pro-democracy opposition party.
“Burma’s at the start of a long but promising path toward democracy,” Tom Donilon, the White House National Security Adviser, told reporters at a briefing. Burma will be discussed by leaders attending the Group of Eight Summit meeting at Camp David, Maryland, beginning today, he said.
Suu Kyi said earlier this week that other nations shouldn’t yet end sanctions against the regime. She said a suspension of the penalties would be a “possible first step” to ensure the government continues moving toward democratization.
Momentum has been building on both sides of the political divide toward freeing up U.S. businesses from entering Myanmar, touted by investors as the next Asian Tiger economy.
Republican Senator John McCain of Arizona has proposed suspending U.S. sanctions, except for an arms embargo and provisions targeted at individuals and entities in Myanmar that impede the movement toward democracy.
Suu Kyi, speaking by video link to a conference on freedom by the George W. Bush Presidential Center, warned her country still has a long way to go.
“The democratization process is not irreversible,” she said.
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