David Cameron has called for sanctions against Burma to be eased after holding talks with opposition leader Aung San Suu Kyi.
Making a historic visit to the former British colony, the Prime Minister insisted that moves towards democratic reform should be rewarded.
He was standing alongside the Nobel Peace Prize laureate in the garden of the lakeside villa where she spent 15 years under house arrest.
"I think it is right to suspend sanctions that there are against Burma," he said. "To suspend them, not to lift them."
Mr Cameron continued: "(Burma) shouldn't be as poor as it is, it shouldn't have suffered under dictatorship for as long as it has and things don't have to be that way. I met with President Thien Sein today and there are prospects for change in Burma and I think it is right for the rest of the world to respond to those changes.
"I do think it is important to send a signal that we want to help see the changes that can bring the growth of freedom of human rights and democracy in your country."
Democracy campaigner Aung San Suu Kyi said: "We still have a long way to go but we believe we can get there. I believe President Thien Sein is genuine about democratic reforms and I am very happy that Prime Minister Cameron thinks that the suspension of sanctions is the right way to respond to this.
"I support the lifting, rather than the suspension, of sanctions because this would be an acknowledgement of the role of the president and other reformers. It would also make it quite clear to those who are against reform that should they try to obstruct the way of the reformers, then sanctions could come back."
Ms Suu Kyi paid tribute to the "help friends have given us over these last decades, especially Britain and other very close friends".
She added: "We have always shared the belief that what is necessary for Burma is an end to all ethnic conflict, respect for human rights - which would include the release of political prisoners - and the kind of development aid which would help empower our people and take our country further towards the road to genuine democracy."