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President Violeta Chamorro announced Friday that the Nicaraguan army, the largest in Central America, will be sharply reduced by early August to half the size it was when she took office.

Chamorro said in a speech that by the time her government completes its first 100 days in office on Aug. 2, the army will be reduced to 41,000 men, half the size it was when she took office on April 25.Top army officer Gen. Humberto Ortega - who will remain in his post - said the Nicaraguan force now numbered about 60,000, having been reduced from 96,660 men at the beginning of the year.

"I want a blessed nation that instead of burying its sons in a war between brothers, buries arms forever," Chamorro said in the speech attended by members of the army high command, the Chamorro cabinet, Roman Catholic Church primate Cardinal Miguel Obando y Bravo and Managua-based diplomats.

Chamorro, however, conditioned further reductions on neighboring countries also reducing their forces.

The Nicaraguan army was formed by the leftist Sandinista government after the 1979 revolution ousted rightist dictator Anastasio Somoza.

During the height of the war against U.S.-backed Contra rebels the government force, still called the Popular Sandinista Army, grew to more than 100,000 men armed with an array of Soviet-supplied weapons.

An estimated 30,000 people died in the fighting.

Local media had reported that Chamorro had been considering announcing the resignation of Gen. Ortega - the older brother of former president and Sandinista leader Daniel Ortega. To some hard-line anti-Sandinistas, he is a symbol of continued Sandinista dominance in the army.

However, in her speech Chamorro made no reference to Gen. Ortega and the army leader told reporters afterwards he was staying on in his post.

"Don't you see me here?" Gen. Ortega replied when asked by reporters if he was stepping down.

Asked how long he would remain in the army, Gen. Ortega said it would depend on "another restructuring process." Upon taking office Chamorro said Gen. Ortega would remain in his post in order to oversee the Contra demobilization and the restructuring of the army.