The European Union has lifted the last of the bloc's trade, economic and individual sanctions against Myanmar, in response to the South Asian country's political reforms.

Monday's decision came on the same day rights group Human Rights Watch (HRW) issued a report that said Myanmar waged "a campaign of ethnic cleansing" against the Rohingya community, citing evidence of mass graves and forced displacement affecting tens of thousands.

"In response to the changes that have taken place and in the expectation that they will continue, the Council [of ministers] has decided to lift all sanctions with the exception of the embargo on arms," said a statement approved without a vote on Monday.

"The EU is willing to open a new chapter in its relations with Myanmar/Burma, building a lasting partnership," it added.

The EU began easing sanctions against Myanmar a year ago as the military, in power for decades, progressively ceded power to civilians and implemented largescale reforms of the economy.

Thein Sein, Myanmar's president, announced a slew of political reforms which resulted in release of political prisoners, most prominent among them Aung San Suu Kyi.

Ministers noted, however, that there were "still significant challenges to be addressed", in particular an end to hostilities in Kachin state and improving the plight of the Rohingya people.

Phil Robertson, the HRW Asia head, said lifting the sanctions was "premature and regrettable", warning that the move lessens leverage over Myanmar.

Myanmar views its population of roughly 800,000 Rohingya as illegal Bangladeshi immigrants and denies them citizenship.

To help Myanmar's economy, the EU will look at the feasibility of a bilateral investment agreement, as well as more development assistance.

The EU is also studying the possibility of assisting reform of the police service, in partnership with its parliament, to help it deal with inter-communal violence, the statement said.

Source: Agencies