Two diplomats say the European Union will drop most sanctions against Myanmar to reward the country's progress toward democracy.

The EU diplomats say the decision will be formally taken by the bloc's 27 foreign ministers when they meet Monday in Luxembourg.

The sanctions — targeting more than 800 companies and nearly 500 people — were suspended last April for one year after the country's military rulers had handed over power to a civilian government that launched democratic reforms.

An embargo on arms and equipment that can be used for internal repression will remain in place.

The diplomats said Friday the end of sanctions should encourage EU firms and development organizations to strengthen their engagement in Myanmar. They spoke on condition of anonymity ahead of the formal decision next week.