David Cameron has become the first UK prime minister to visit Burma in more than 60 years after arriving in the capital Nay Pyi Taw.
He met President Thein Sein and is to hold discussions with pro-democracy leader Aung San Suu Kyi in Rangoon.Speaking on arrival, Mr Cameron said the government had to demonstrate that moves to democracy were "irreversible".
He is the first Western leader to visit Burma since Ms Suu Kyi's success in a series of parliamentary by-elections.
Burma was ruled for almost half a century by a military junta that stifled almost all dissent and wielded absolute power. The EU, US and other nations imposed sanctions.
The first general election in 20 years was held in 2010.
The installation of a military-backed, nominally civilian government in March 2011 and a series of reforms since - including the release of hundreds of political prisoners - has led to speculation that decades of international isolation could be coming to an end.
'Shining example' "There is a government now that says it is committed to reform, that has started to take steps, and I think it is right to encourage those steps," Mr Cameron said.
But he added: "We should be under no illusions about what a long way there is to go and how much more the government has to do to genuinely show this reform is real and that it's irreversible, and we should be very cautious and very sceptical about that."
He also said he wanted to meet Ms Suu Kyi, describing her as "a shining example for people who yearn for freedom, for democracy, for progress".
Mr Cameron is the first serving British prime minister to visit Burma since it gained independence from Britain in 1948.
It is the final leg of his tour of South East Asia promoting UK interests.
EU foreign ministers are to discuss policy towards Burma on 23 April.
Sanctions, which include an arms embargo and an assets freeze imposed on nearly 500 people, are due to expire on 30 April. Earlier this year, the EU lifted travel bans on more than 80 senior officials, including the president.
If they are satisfied that recent steps taken by the government are likely to be sustained, they could ease certain financial sanctions.
BBC South East Asia correspondent Rachel Harvey, in Rangoon, says although the UK has a reputation within the European Union as being among the most cautious about the recent changes in Burma, the pace of reform in the country is impossible to ignore.
Mr Cameron will want to use his meetings to help shape Britain's position within that argument, she says.
On Thursday, Mr Cameron told BBC Radio 5 live he would meet the Burmese president and "thank him for the work that he has done" on democratic reform.
Mr Cameron is expected to tell the president the UK is prepared to provide support to the country in areas such as how to build a democracy, tackling corruption and peace and reconciliation, if the country moves ahead with reform and the EU sanctions are lifted.
The PM is then set to take part in a joint news conference with Ms Suu Kyi, who was recently elected to parliament after two decades spent mostly under house arrest.
The pair are then expected to have a private dinner in Rangoon.
'Purely political' visit Earlier, while in Malaysia, Mr Cameron said he and other regional leaders believed the Burmese government's desire for reform was genuine.
"I hope that following my meetings I will have the confidence to go back to my country, back to others in the European Union, and argue that change in Burma is irreversible... and, in a world of difficult and darkness, and all sorts of problems, here is one bright light we should encourage," he said.
Ten members of the business delegation, which includes defence firms, accompanying Mr Cameron on his tour are also in Burma.
However, Downing Street has insisted the visit is purely political and the businessmen will merely be carrying out "cultural" activities.
On Thursday, former Labour minister Baroness Kinnock, the chairwoman of the all-parliamentary group on Burma, said the PM was correct to acknowledge there had been progress.
But she warned against any "chipping away of sanctions", saying it was too soon to consider lifting the arms embargo and restrictions on key industries such as mining and timber when the military still had a monopoly of power.
Mr Cameron is not the first major Western figure to visit the country. US Secretary of State Hillary Clinton made a landmark trip to Burma in December 2011.
Thank u Mr Prime Minister David Cameron for ur visit hope changes may bring peace to all population of the country especially for ethinic minority like Rohingya who were dinied citizenship and basic rights.
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