WASHINGTON ? US President Barack Obama on Friday removed Laos and Cambodia from a blacklist, opening the way for US loans to companies doing business in the former US adversaries.

In brief declarations, Obama said Cambodia and Laos had each "ceased to be a Marxist-Leninist country," a designation that prevents financial support by the US Export-Import Bank.

The move, which still must go through formalities, means that US businesses would be eligible for US government-backed loans and credit guarantees as they can receive when operating in most countries.

"Given the commitment of Cambodia and Laos to open markets, the president has determined that this designation is no longer applicable," an Obama administration official said.

But the decision to boost trade ties with Laos came under criticism from campaigners for the Hmong minority, a hill people who supported US forces during the Vietnam War and recount retaliatory abuse decades later.

A recent report by Paris-based Medicins Sans Frontieres, or Doctors Without Borders, said Hmong who fled since 2005 to Thailand have said they suffered killings, gang-rape and malnutrition at the hands of Laotian forces.

Obama's declaration "is completely shocking and outrageous," said Philip Smith, executive director of the Center for Public Policy Analysis, which promotes Hmong rights.

"This is a one-party regime which is closely allied with Burma [Myanmar] and North Korea," he said. "This will embolden the Laos government to continue to slaughter and massacre civilians."

Many Hmong are still in hiding in Laos. Another 250,000 Hmong have resettled in the United States.

The United States established normal trade relations with Laos in 2004, part of an effort under then president George W. Bush to reconcile after years of friction.

US relations with Cambodia have been marred by US concerns over accounting for Khmer Rouge war crimes along with corruption. Washington lifted all remaining restrictions on assistance to Cambodia in 2007.

The United States still forbids US-backed loans to businesses to operate in six countries ?Cuba, Iran, Myanmar, North Korea, Sudan, and Syria.