El Salvador, the only Latin American country with a military presence in Iraq, is to reduce the number of its troops in the war-torn country from 380 to 300.
Elias Antonio Saca, El Salvador's president, made the announcement on Saturday.
"We will be reducing the number of troops we contribute [to the war in Iraq]," said Saca, adding that the cuts would begin next month.
He made the remarks at the opening of a new health clinic in San Salvador, El Salvador's capital.
Saca said that Iraq was still facing "a very difficult internal conflict".
He told reporters that he would be sending a ninth contingent of troops to Iraq in August, but that the overall numbers would be reduced by 21 per cent.
El Salvador has seen five of its soldiers killed and 20 wounded since the US-led invasion began in March 2003.
In a move to reassure Salvadorans that their soldiers are generally safe in Iraq, Saca said when he visited Salvadoran troops in Al-Kut in June, he saw them "in a pretty calm place."
But he said Iraq "is dangerous, because there's a very difficult internal conflict".
The Salvadoran military contingent, under US military leadership, is mostly helping in the reconstruction effort in Iraq's eastern province of Wasit.
Earlier this year, Britain, the main US ally in Iraq, announced that it would reduce its forces in Iraq by 1,600 to fewer than 5,000 troops later in the year.
Denmark also said it would withdraw nearly all of its 460 troops stationed in Iraq in August, while Lithuania is still to decide whether it will pull out its 58 troops by the end of the year.
The US, which currently has about 159,000 troops in Iraq, is facing increasing pressure to pull its own troops out, amid mounting domestic opposition to the war
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