Deputy department spokesman Adam Ereli said some progress had been made on President Enrique Bolanos' pledge to eliminate the stocks of man-portable air defense systems, or MANPADS.

But differences within the Nicaraguan government have held up the process, prompting US action, Ereli told reporters at the daily State Department briefing.

"In light of those differences, I think some of our security assistance will sort of be put on hold until the differences can be resolved and the elimination of the MANPADS proceed forward," he said.

Ereli said about two million dollars in aid had been suspended, mostly for training and credits to purchase military materiel. This was a fraction of the nearly 46 million dollars in overall US assistance to Nicaragua.

A government source in Managua said Saturday the United States was freezing military aid to Nicaragua until it scrapped the Soviet-made SAM-7 missiles, which Washington fears could fall into the hands of terrorists.

Concerned by the whereabouts of missiles dating from the conflict between leftist Sandinistas and contra rebels in the 1980s, the United States last month sent a mission to Nicaragua to review progress on Bolanos' pledge.

Nicaragua had said it would destroy some but not all of the missiles, but Ereli said that both governments agreed the "destruction of these stocks is in our mutual interest and the interest of regional security."

"They pose a threat. And we look forward to having the destruction get back on track," he said.

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