MANDALAY, Myanmar -- Myanmar's Aung San Suu Kyi was due to meet with Mandalay's military commander on Friday afternoon in what party members described as a "significant development" during her first political trip outside the capital since her release from house arrest.

It is understood to be Aung San Suu Kyi's first meeting with a junta official since her May 6 release.

"After lunch she is going to meet the military commander of the Mandalay central military command, who is also chairman of the regional State Peace and Development Council (SPDC), Major General Ye Myint," a source from the National League for Democracy (NLD) told AFP.

The SPDC is the official name of Myanmar's ruling military regime.

"This is a significant development. It is one indication that there is more coordination and interaction between Aung San Suu Kyi and the authorities," the source said.

Observers have expressed concern since the leader's release that her secret dialogue on national reconciliation with the ruling military regime had stalled as she had apparently not met with any SPDC officials. The talks began in October 2000.

The hugely popular leader left Yangon on Saturday for her first political trip outside the capital since she was freed from 19 months' house arrest.

The trip has particular significance because Mandalay, lying some 695 kilometres (430 miles) north of Yangon, was the city the ruling military regime barred her from travelling to in September 2000.

Soon afterwards the generals confined her, to her famed lakeside villa in the capital.

A trip such as this was expected by observers to be a true test of the regime's undertaking to grant Aung San Suu Kyi freedom of movement, and so far NLD sources say this is what she has enjoyed.

Earlier on Friday, "the lady", as she is known, met in a closed session with representatives of the NLD offices from the 16 townships that make up Mandalay district.

Other representatives waited outside the meeting room at the headquarters eager to talk with journalists.

"I never would have dared speak to a journalist before. But now I can tell you what I think," Aung Pe, a member of the organizing committee from Ngazun township.

He said his leader's visit had already improved freedoms for NLD members.

"Her visit has made life easier for us, party members security-wise and we have recovered at least 50 percent of our freedom of movement. We are wearing our NLD badges without harassment," he said.

Aung Pe said the new political freedoms were due to the massive support people had given Aung San Suu Pyi since her arrival in Mandalay.