WASHINGTON, Jan 13 (Reuters) - The United States said on Friday it was ready to exchange ambassadors with Myanmar as President Barack Obama welcomed the release of 200 political prisoners as a "substantial step forward for democratic reform" in the Southeast Asian country.
U.S. Secretary of State Hillary Clinton said Washington was ready to begin the process of exchanging full ambassadors after an absence of two decades, and would consider additional measures if the new civilian-led government's reforms continue.
"Much more remains to be done to meet the aspirations of the Burmese people, but the United States is committed to continuing our engagement," Obama said in a statement.
The U.S. move followed Myanmar's announcement that it was freeing some 200 political prisoners in an amnesty in the latest sign of change in a country that has spent half a century under authoritarian rule.
The United States downgraded its diplomatic representation in Myanmar to charge d'affaires following a military coup in 1988 and a violent crackdown on pro-democracy protests in the country, formerly known as Burma.
The United States and other western nations have also imposed a series of broad economic sanctions, which analysts say have crippled the country's economy and driven it deeper into the embrace of regional power China.
Myanmar held elections last March which saw a nominally civilian government -- although still heavily weighted toward the military -- take over from the ruling junta.
Since then, the government has embarked on a series of reforms that have prompted the United States and other western nations to suggest they may eventually remove sanctions if enough progress is made.
Clinton, who traveled to the isolated Southeast Asian nation in December, said the United States welcomed reforms already under way, which included freeing veteran pro-democracy leader Aung San Suu Kyi in November 2010.
"I intend to call President Thein Sein and Aung Sang Suu Kyi this weekend to underscore our commitment to walk together with them on the path of reform," Clinton said.
Clinton said the United States would work with Myanmar to address concerns of ethnic minority groups, ensure that a by-election scheduled for April 1 are free and fair, and that all remaining political prisoners are also released.
"But this is a momentous day for the diverse people of Burma and we will continue to support them, and their efforts, and to encourage the government to take bold steps that build the kind of free and prosperous nation they desire to see," she said. (Reporting By Matt Spetalnick)
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