EU chief Barroso offers new development aid to Burma
European Commission chief Jose Manuel Barroso has offered Burma more than $100m (£62m; 78m euros) in development aid as he met President Thein Sein.
The two men met in the new capital, Nay Pyi Taw, and discussed steps to boost trade following decades of sanctions.
Mr Barroso also held talks with opposition leader Aung San Suu Kyi.
She would not be drawn on the plight of Burma's mainly Muslim Rohingya minority, which has attracted international concern.
In recent months, violence between Rohingyas and Buddhists in Rakhine state has forced 100,000 from their homes.
Around 90 people were killed in a renewed bout of communal violence last week.
President Thein Sein acknowledged earlier that attitudes towards the Rohingyas must be changed.Trade privileges
The president of the European Commission is the latest in a series of Western officials to visit Burma since the military-backed government began reforms last year.
The government has published details of a new foreign investment law which is aimed at attracting overseas companies.
Over the past decade, trade links and aid between the EU and Burma have been a fraction of those with other Asian countries.
EU member states had imposed tough sanctions on the military because of its repressive rule.
At the scene
There was a time, just a few years ago, when Nay Pyi Taw was a secretive, mysterious place, a capital city planted overnight in the scrubby hills of central Burma. Foreign embassies refused to relocate here and few foreign dignitaries ever visited.
It is still a bizarre, other-worldly city, built on a massive scale. The buildings - parliament, ministries, presidential palace - are colossal, as though designed for giants, and simply miles apart. It takes a good 25 minutes just to drive around the parliament, a dizzying, fortified complex of faux-Burmese halls. It feels more like a relic of Burma's isolationist, authoritarian past than the seat of its democratic future. There is little chance ordinary citizens could make their way in to petition their MPs.
But this city is where world leaders have to come to engage with the new Burma, with its tremendous hope of a peaceful transition and its tremendous economic opportunities. Mr Barroso is the most senior Western leader to come here so far.
There is now an established ritual to these visits. First the gilded rooms of the presidential palace to meet Thein Sein, the old general who has become the unlikely champion of reform. Then Shwe Mann, the powerful speaker of parliament, once a protege of former military strongman Than Shwe and a likely presidential candidate. And then the modest grey home of Aung San Suu Kyi.
This is the odd trio who must chart Burma's uncertain future. Ms Suu Kyi, once the prisoner of the other two, now co-operates with them in parliament but she is also a potential rival. It is an uneasy relationship, one on which the country's embryonic democracy now depends.
As well as aid, the EU is believed to be offering Burma the same trade privileges as other low-income countries get.
It will also fund a new "peace centre" to help Burma resolve the long-running conflicts between central government and ethnic minorities.Tolerance call
Speaking after her meeting with Mr Barroso, Ms Suu Kyi told the BBC she could not speak out on the status of the Rohingya, who are denied citizenship.
She has been subjected to some uncharacteristically stinging criticism over her unwillingness to speak up for the Rohingyas, described by the UN as among the most persecuted minorities on Earth, the BBC's Jonathan Head reports.
But speaking to the BBC from her modest home in the new Burmese capital, she was unrepentant.
People on both sides in Rakhine state had suffered from the communal violence, she said - it was not her place to champion one side or the other.
"I am urging tolerance but I do not think one should use one's moral leadership, if you want to call it that, to promote a particular cause without really looking at the sources of the problems," she said.
Ms Suu Kyi added that she had seen no statistics to show that 800,000 Rohingyas were being denied citizenship.
The much criticised 1982 law that excludes them should be looked at, she said.
But her continued caution on the issue of the Rohingyas, whom many Burmese say should be driven out of the country, will disappoint human rights campaigners, our correspondent says.