President Barack Obama announced on Friday that all remaining American troops would leave Iraq by the end of 2011, keeping a campaign promise, after Washington and Baghdad failed to reach agreement on maintaining perhaps thousands of troops as trainers, in part as a buttress against Iranian influence.

But Panetta said Iraq would be able to handle itself and noted that America would still have some 40,000 troops in the region not counting those fighting in Afghanistan.

"Iraq itself has developed an effective force to be able to deal with those threats," Panetta told reporters after meeting with Southeast Asian defence ministers on the Indonesian resort island of Bali.

Copyright Reuters, 2010