"We will not allow new hotel constructions there," Soe Thein, minister of the president's office, told dpa.
There are currently 17 hotels under construction in four zones adjacent to temple city, but none are situated in the site itself.
Over the past two decades, several hotels and other buildings were granted permission to be constructed in the heart of ancient Bagan, such as the Aureum Palace Hotel and the 61-metre Royal Watchtower, to the annoyance of conservationists.
"We must keep Bagan as an ancient city, but we can't cancel the hotel deals that the former government allowed," Soe Thein said.
Bagan was a Buddhist kingdom during the 9th to 13th centuries. It boasts thousands of pagodas and monasteries and is one of Myanmar's most popular tourist attractions, drawing an estimated 400,000 tourists last year.
Myanmar first proposed Bagan as a UNESCO World Heritage Site in the mid-1990s, when the country was still under military rule, but withdrew the nomination after the United Nations agency requested more details on preservation and management plans, UN sources said.
President Thein Sein visited Bagan recently and suggested that it should be resubmitted as a nominee for heritage site status.
"They are interested in going ahead with Bagan," said Tim Curtis, chief of the culture unit at UNESCO regional headquarters in Bangkok.
The nomination process usually takes a few years.
"In my opinion, it is important to move quickly because the tourism pressure on the site as the country opens up could have terrible effects," Curtis said.
There are already 75 hotels, motels and guest houses in four hotel zones near ancient Bagan, and a fifth zone has been designated.
An estimated 1,100 tourists visit Bagan daily, paying an entrance fee of 15 United States dollars that earns the government millions of dollars in revenue each year.
source: Bangkok Post