13 February 2012 Last updated at 10:57 ET

EU announces $200m Burma aid package

The EU's Andris Piebalgs said he favoured lifting sanctions against Burma

A European Union envoy has announced more aid for Burma, holding out the prospect of a further easing of sanctions, after talks in the country.

Development Commissioner Andris Piebalgs said that if by-elections in April were free and fair, more sanctions were likely to be eased.

He announced an aid package of nearly $200m (£128m) aimed at health, education and training.

He said President Thein Sein had spoken positively about Aung San Suu Kyi.

The opposition leader is currently standing for a seat in parliament.

"There is concern [on the government side] that they've made reforms, they released political prisoners, they opened up, but the sanctions are still in place," Mr Piebalgs said.

"Now it's very clear that the watershed is elections in April. If it goes as expected and is free and fair, then everyone would expect the easing of sanctions to continue."

Elections in November led to parliament being dominated by military personnel and an army-backed party. The vote also led to opposition complaints of rigging.

But by-elections on 1 April should see more opposition members voted in, including Ms Suu Kyi, a Nobel Peace laureate and long-time campaigner for democracy.

"The president mentioned a lot about Aung San Suu Kyi and it was all positive. That was unexpected," Mr Piebalgs said.

"He said she was extremely important in the country and her participation in the political process was crucial. That's a very positive sign."

Mr Piebalgs will meet Ms Suu Kyi at her home in the former capital, Rangoon, on Tuesday.

He said that sanctions are definitely affecting Burmese growth and were painful for the government because they impeded potential for foreign investment.

He said that suspending some measures however would take time, because such a move needs consensus among 27 EU countries, something that is "not such an easy thing to achieve".