In the single street of Rangoon’s crowded Bothun San neighbourhood, attention is focused on the daily afternoon lottery. Hugely popular among the near-destitute labourers and their families, and played between neighbours on the flattened earth, it offers the prospect of a square meal rather than immediate life-changing wealth.

Stakes are small but wins are big, enough to feed a family for a day or so. “If I win then we get fish or even chicken,” said Myat Soe, a 50-year-old labourer who lives with seven relatives in a makeshift bamboo house without power or sanitation. “If I win 100 times maybe I’ll get rich.”

Myat Soe is not the only one thinking about making large amounts of money in Burma. Hundreds of the world’s biggest companies are making plans to move into the country if political progress towards democracy continues. They hope to make millions as the repressive regime seeks to reintegrate in the international community.

The EU, the US and Canada are considering how and when they will ease sanctions imposed over the past 20 years on the brutal military authorities that ruled – and some say still rule – the country. Any change will send a signal to potential investors that Burma is no longer considered a pariah state.

A week ago, travel restrictions on senior Burmese officials were lifted by the EU. A full review of the sanctions is scheduled for April.

One businessman staying at a five-star hotel in Rangoon spoke this month of a “gold rush” in Asia’s second-poorest country. “It is when, not if, for most of us. I think there’s a bit of a Klondike feel,” said the businessman, who did not want to be named, said.

Prompting the change has been a series of reforms implemented by the nominally civilian government that took power last year. President Thein Sein has met key opposition leaders including the democracy campaigner Aung San Suu Kyi, eased censorship, legalised trade unions and released hundreds of political prisoners.

Senior European politicians including William Hague, the British foreign secretary, and Alain Juppé, his French counterpart, have visited Burma in recent months to “encourage” the changes. Hillary Clinton came late last year, the first US secretary of state to travel to Burma for more than 50 years.

All the visitors have made clear that further reforms will be rewarded. Since the sanctions were imposed after the bloody repression of protests in the late 1980s and a cancelled election in 1990, Burma has been isolated economically.

In recent years Chinese companies, many state-backed, have established a large presence, investing in all sectors from infrastructure and natural gas to timber and precious gems. One reason for the authorities’ attempt to “democratise” may be a fear of over-dependence on Beijing. Another may be a simple desire to catch up with countries such as Thailand or Singapore. There is no shortage of interest from global and regional businesses.

Burma has more than 60 million inhabitants and a key coastal location between India, China and the “tiger” economies of south-east Asia, making it an attractive market. It also has vast mineral, metal and other resources.

The longest queue at Rangoon airport these days is not for check-in, taxis or cappuccinos costing $4 each but for mobile phone connections. As things stand, no overseas network can be used in Burma. Hotels are full as business delegations arrive.

The mood is dominated by a certain degree of hysteria – a rumour that Bill Gates would be arriving within weeks proved to be unfounded – but the enthusiasm for investment is undeniable. “If you can find ways to invest in Myanmar [Burma] you will be very, very rich over the next 20, 30, 40 years,” Jim Rogers, the chairman of Rogers Holdings of Singapore, told Bloomberg TV recently.

Shipra Tripathi, vice president of an Indian firm specialising in pumps, travelled from Delhi to Burma with a trade delegation. “I wanted to see the opportunities that are opening up. I was pleasantly surprised by the pro-activeness of the government. We have already got teams in the country and are looking at a pilot project,” Tripathi said.

A recent Japanese delegation included officials from Hitachi and Toshiba. Senior executives at Standard Chartered bank have said they are “looking at the changes [in Burma] very closely”. India’s Tata Motors car and truck manufacturer is keen too.

Another key area is tourism. Burma’s unspoilt beaches and mountains and rich cultural heritage could make it a leading destination, tour operators believe, and luxury hotel chains such as Marriot have said they are keen to establish a presence.

There is also the growing demand from an emerging Burmese middle class. Upmarket shopping malls in the centre of Rangoon cater to a new elite, often connected to the powerful clique of top military officers who still dominate the economy.

In one, brands from Guess to Versace fill shop windows. Than Than U, a civil engineer, had come with his daughter to buy sunglasses. “We like it here. We come about once a month and spend $500,” he said.

Though senior British officials describe President Thein Sein as “sincere”, Burma’s generals in effect still control parliament after a deeply flawed 2010 election. Western diplomats in Rangoon say much depends on whether byelections in April, which will be contested by Aung San Suu Kyi and her party, are free and fair. Removing sanctions is a complex and lengthy process. “Even with the best of political will … it will take a long time,” said Frances Zwenig, counsellor with the US-Asean Business Council, a trade group whose members include Google and Coca-Cola.

In the narrow, mosquito-infested lanes of Bothun San, no one is expecting miracles soon. There is no sanitation in the illegal settlement and haphazard electricity – a situation unlikely to improve for the foreseeable future. “The rulers don’t come here. No one comes here and nothing changes,” said 48-year-old Myan Maun, a vegetable hawker, before putting down another stake for the lottery.