When, as a young army officer, Thein Sein arrived in northern Myanmar in the 1970s to lead a unit fighting communist-backed insurgents, nothing could have been more outlandish in his world of malarial jungles and gunfights than the idea he would end up in a grandiose palace leading the country.

Equally improbably, this son of poor peasants from a remote village in southwest Myanmar is leading his country away from the authoritarian, junta-style regime through which he rose. And, as president, he is pledging to resolve many of the ethnic conflicts in which the army has been embroiled for decades.

“As a soldier for my whole career, fighting these armed groups, I saw them as ‘the enemy’ – but when I became president, I realised the death of a Kachin soldier is the same as the death of a national army soldier – it is the death of a Myanmar citizen and therefore a loss to the country,” he tells the Financial Times in one of the first interviews he has given since becoming president 18 months ago. “Now I no longer see [rebel forces] as part of the ‘enemy’ but as part of the solution.”

So far his government has signed agreements with 10 of 11 main ethnic rebel groups. In response to a lack of progress in peace efforts with Kachin rebels in the country’s north, he has overhauled the negotiation process and placed one of the top reformist ministers, Aung Min, to co-ordinate peace efforts.

For Mr Thein Sein, the critical turning point was his appointment as prime minister in 2007, having attained the rank of full general under Than Shwe – the junta leader known as the “senior general”.

Suddenly, after years in the relatively cloistered military world, Mr Thein Sein was visiting neighbouring countries to liaise with counterparts, and even attending a UN session in New York. His formative experience from these years, however, was dealing with the devastation of Cyclone Nargis, which killed more that 130,000 people in 2008.

General Than Shwe, though brutal, xenophobic and highly superstitious, was quietly laying the groundwork for radical change, setting in train plans for a parliamentary system, a government overhaul and, crucially, his own retirement.

In another move that still confounds critics, General Than Shwe anointed Mr Thein Sein as his successor to run in the 2010 election. The poll was boycotted by opposition leader Aung San Suu Kyi and her party and condemned by the international community as fraudulent. Mr Thein Sein came to power under that cloud, branded the senior general’s key henchman.

Yet by mid-2011, Mr Thein Sein had launched radical reforms and was rapidly opening up a harsh and hermetic society under economically ruinous military management. Since then, he has driven reforms encompassing everything from labour unions and pensions to land use and crucial economic changes, including financial liberalisation and a partial float of the currency, the kyat.

However, he stresses, “the system has changed”. “There was an understanding that things could not go on the way they were, there was a need for this change – and the legacy of General Than Shwe was to establish this system – now we are in this new era where this government and I are trying to lead things forward.”

Much remains to be done, he tells the Financial Times. But top of a list that ranges from overhauling the legal system and launching a “second wave” of economic reforms to improving healthcare and education, is poverty alleviation, jobs creation and industrial development.

“I myself am from a very poor background. I experienced firsthand poverty in this country, and that is not unrelated to my desire, from the moment I became president, to make a priority of poverty reduction in this country,” he says.

As president he has set the goal of reducing the current poverty level of 26 per cent of the population to 16 per cent by 2015. He also wants to triple Myanmar’s per capita domestic product from $750 currently, over the same period.

The latter target, he admits, is aspirational and meant “to motivate people” much “like for a student preparing for exams and setting overly ambitious goals”.

But he is intent on pressing his reform agenda. A restructuring and reshuffle of the cabinet that could be presented to parliament next week is intended to set the scene for the next wave of changes. It is expected to see the elevation of pro-reform ministers such as Aung Min, a reorganisation of some ministries and the appointment of the cabinet’s first woman minister as head of a new ministry of culture.

“There are some in the cabinet who may be slower or who may not be performing as well in terms of trying to realise the objectives the government has set out,” the president says. “It is because of that that there may need to be changes.”

He cautiously defends the military’s role, saying that, while it still holds 25 per cent of parliamentary seats, its power is now “more limited”.

“This is an armed forces [that] the country has had to rely on for a very long time for security?…?so it was important at this time that they were not left behind entirely,” he says. And, he adds, “they have a limited role within the constitution”.

As for General Than Shwe, who, some say, still pulls strings from his retirement seclusion: “He is not involved in any way in current government affairs, but he is someone who has been my boss in the past, someone I respect,” Mr Thein Sein says.