Burma brimming with optimism as Obama visit approaches

• March turnover of power has sparked business investment
• New cabs, air conditioning are more prevalent
• Political prisoners have been released, but human rights still a concern

YANGON, Burma — At a tiny mobile phone shop in downtown Yangon, people jostle for space, eager to inspect the latest handsets and accessories.

In the middle of it all sits shop owner, May Phu Aung, a savvy 29 year-old who knows she's in the right business.

"If they want to develop the country, they have to implement a very good communications system, everyone must have a mobile phone," she says, watching her staff hash out deals with potential customers.

This time last year, mobile phones in Burma, also known as Myanmar, were limited to the cash-rich elite who could afford to hand over $1,000 for a SIM card. Even now that the price has dropped to around $200, only 5% of the population owns a mobile handset, according to government estimates.

But all this could change very quickly, with the telecommunications sector, currently monopolized by a state-owned entity, poised to open up to outside investment, guaranteeing even cheaper access.

"It's highly possible that the SIM card price will come down — if the price comes down, more people will buy phones," says May Phu Aung with a confident smile.

Telecommunications is just one of many areas undergoing massive change as Burma emerges from 49 years of isolation under military rule. The first hint of change came with the release of pro-democracy icon Aung San Suu Kyi in late 2010, paving the way for her return to politics.

In March last year, the military ceded power to a new semi-civilian government under President Thein Sein. And since then the government has been pushing forward regulatory reforms aimed at firing up the economy and scaling back decades-long restrictions on the freedom of Burmese citizens.

This transition is about to receive its strongest international endorsement yet, as President Obama gets set to become the first U.S. leader to officially travel to the country. The Burmese government is fully aware of the significance as it awaits his arrival Monday.

Burmese presidential office spokesman Zaw Htay said in a statement that the visit shows "concrete support for the democratization process of President U Thein Sein, Daw Aung San Suu Kyi, members of parliament and the Myanmar people."

If Obama can catch a glimpse of life on the streets of Yangon, Burma's largest city, he'll see hints of what the new nation might look like.

Battle-weary cars, taxis and buses — some of them relics from the 1960s — are now giving way to new Japanese and Chinese models after the government eased vehicle import regulations and promoted a trade-in system for the oldest rust-boxes. In the oppressive heat, the city's residents can now select air-conditioned comfort when looking for a ride.

"If there are four or five taxis at a stand, passengers will choose only a new car," says My Mine, a 33-year-old taxi driver whose beaten-up 1991 Mitsubishi is not often their first choice.

In front of dilapidated buildings, billboards for foreign products like Coke, Pepsi and Samsung smart phones sit side-by-side with local signs advertising instant coffee and milk powder. Below them on the traffic-clogged streets, vendors hawk hard copies of the recently passed Foreign Direct Investment Law, legislation that has done something to ease the nerves of foreign investors wanting to break into Burma's market of 60 million potential consumers.

The skies overhead are also busy, with foreign airlines launching new direct flights. In the first half of 2012, the number of foreigners that flew into Yangon and Mandalay was double that of the previous year, according to Myanmar's tourism minister U Htay Aung.

"We can see a lot of interest in Myanmar from a range of travelers from all over the world," says Nay Aung, the founder of oway.com.mm, one of the first Burma-related travel websites.

A Stanford graduate and former Google employee, Nay Aung, returned to his home country from the U.S. just as the reforms took hold last year — part of a wave of returning residents seeking to get a foothold in the new Burma. He admits that there have been challenges setting up a business in a country that still rejects credit cards, and where internet connection speeds are painfully slow.

It's also not always easy to get information about new changes or regulations, but he says, "there has to be an element of belief that things are going to happen."

But it's with more caution that the country's citizens have responded to government moves to improve its reputation on human rights.

Hundreds of political prisoners have been released from jail, media censorship has been formally abolished, and protests have been made legal. But organizations supporting political prisoners say there have been more than 200 politically motivated arrests since the start of the year.

At the same time, ongoing clashes between Muslims and Buddhists in the country's west, and tensions between the government and ethnic minorities are already overshadowing preparations for the 2015 general elections.

Now, in her new role as a politician and leader of the opposition, even the usually well-loved Aung San Suu Kyi, referred to as "the Lady," is finding she is not immune to criticism, especially over her handling of the country's ethnic tensions.

"These days I realize that the Lady herself is not speaking that much for the minority's plight," says Daniel Padzang Zau Du, a young ethnic Kachin working as a project manager in Yangon. Kachins are from the northernmost state in Burma.

Despite the challenges, it's hard to deny the optimism on the streets, and the sense that Burma's citizens are taking their new freedoms and running with it. Back at her small mobile phone shop, May Phuy Aung is already ordering new stock in preparation for increased demand.

"It's time for me to create my own destiny," she says, "(And that of) my family, and my country."