(CNN) -- The United States announced Wednesday that it is easing sanctions on Myanmar, also known as Burma, allowing American companies to conduct business in the Southeast Asian nation.
An investment ban had been in place since 1997.
"President Thein Sein, Aung San Suu Kyi and the people of Burma continue to make significant progress along the path to democracy, and the government has continued to make important economic and political reforms," President Barack Obama said in a written statement. "Easing sanctions is a strong signal of our support for reform, and will provide immediate incentives for reformers and significant benefits to the people of Burma."
The country has undertaken recent reforms, including the release of Nobel Peace Prize laureate Aung San Suu Kyi, who is now a member of parliament and leader of a political opposition group.
But, Obama cautioned, the nation's "political and economic reforms remain unfinished."
"The United States government remains deeply concerned about the lack of transparency in Burma's investment environment and the military's role in the economy," he said in the statement.
For decades, Myanmar was ruled by a repressive military junta. But in recent years, the generals have relaxed their grip on power, permitting Thein Sein's administration to push through a series of changes, including peace talks with rebel groups and the release of hundreds of political prisoners.
Last week, the government announced the planned release of 24 political detainees, the latest after hundreds of political prisoners were set free in the previous year as part of the reforms.
Other Western governments have responded to the efforts by easing sanctions on the country.