Aung San Suu Kyi on Saturday set out to promote an overhauled investment law to a new generation of smaller businesses that her government hopes will one day dilute the influence of Myanmar’s old military-linked oligarchs.

The new blueprint aims to level the playing field between foreign and local businesses in Myanmar. It was signed into law Oct. 18, shortly after U.S. President Barack Obama set off a new ripple of interest in Myanmar by formally dropping the U.S.’s remaining sanctions on the country. His move followed several years of reforms resulting in the election of Ms. Suu Kyi, a former political prisoner, as Myanmar’s de facto leader last year.

But investment and government officials also designed the streamlined law to make it easier and faster for smaller, local business to secure operating permits. It is hoped they can inject some new life into Myanmar’s economy, which, while expanding quickly—by up to 7.8% this year, according to the World Bank’s estimates—is growing from a very low base.

Speaking to investors and business leaders in the capital, Naypyitaw, Ms. Suu Kyi acknowledged the economy didn’t grow as much as her government had expected since taking office in April. “There were many reasons for that,” she said. “The important thing for the country’s development and economy now is to improve the people’s abilities. If we can do that we can establish a sustainable and reliable business environment.”

The economy of Myanmar, also known as Burma, has been badly distorted by decades of economic sanctions, limiting its ability to trade with the rest of the world. Political analysts, such as Richard Horsey in Yangon, point out that the sanctions also had the effect of centralizing capital and power in a relatively small coterie of cronies who had access to lucrative government and military contracts.

Starved of overseas support, other companies struggled to get off the ground, limiting the growth of small and medium enterprises that typically provide the bulk of growth in nearby countries such as Thailand and Vietnam.

Now, though, the nation’s finance and planning minister, Kyaw Win, at the Naypyitaw conference said Myanmar will likely see an expansion in banking, trade and credit growth to help strengthen the growth of SMEs and other businesses.

The government is also offering tax incentives under the new investment law to help nurture new businesses. Under the guidelines, companies setting up operations in the least-developed areas of the country will be exempt from paying tax for seven years. In some other poorly developed areas, the tax holiday will last from three to five years.

Still, some business leaders say they worry the government won’t be able to remove as much bureaucratic red tape as it says it will, and that the underdeveloped banking sector may remain a problem for some time, despite Ms. Suu Kyi’s plan to improve the business landscape.

“We are not playing at the same level as international companies because of high interest rates, poor trade financing facilities and higher transaction costs,” said Soe Tun, an executive committee member of Myanmar’s Chamber of Commerce, who attended Saturday’s speeches. “We feel like we’re handicapped.”

Foreign companies, meanwhile, will also find it easier to lease land under the new framework, officials said. Previously leases and conditions varied, but now firms investing under Myanmar Investment Commission rules will be able to lease land for up to 50 years, with two extensions of 10 years each.