Defence Secretary John Hutton has signalled there will be a "fundamental change" in Britain's role in Iraq early next year as he made his first visit to Baghdad.
He held talks with Iraqi prime minister Nouri Maliki before meeting the small number of UK forces stationed in the Iraqi capital.
Afterwards, he said "significant progress" had been made in Iraq in recent months and security was improving across the country.
"We want, in the first months of next year, to see a fundamental change in our military mission in Iraq, moving towards an increased focus on military training and education as part of a broad-based bilateral partnership," he said.
"We agreed to work together intensively to put in place, by the end of this year, a formal agreement in relation to the status of UK forces in Iraq which will underpin this change."
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