The report to Congress, titled "Measuring Stability and Security in Iraq," said the security situation in the country continues to improve. The report covers the period through the end of November, and does not address the change of responsibility to the Iraqi government for security under the status-of-forces agreement that went into effect Jan. 1.
Iraqi forces are increasing their capabilities, the report says, and the Iraqi government has demonstrated its rejection of extremism and has assumed responsibility for the "Sons of Iraq" civilian security group program.
"This period witnessed a nationwide reduction in civilian deaths by almost 63 percent compared to the same period in 2007," the report says. Further, no increase in violence took place during or immediately following the holy month of Ramadan - typically a time of increased attacks.
The insurgency is declining, and al-Qaida in Iraq is increasingly isolated, the report says. Many Shiia extremists are seeking amnesty and leaving Iranian-supported militant groups such as Jaysh al-Mahdi and affiliated organizations, it notes, though both Sunni and Shiia extremist groups still are capable of conducting attacks despite their weakened condition.
Most of Iraq now is under Iraqi control. The status-of-forces agreement places Iraqi forces completely in the lead and calls for all coalition combat forces to be out of Iraq by the end of 2011.
That withdrawal has already begun, with one U.S. brigade combat team having left the country during the period covered by the report. Polish troops are ending their assignment in the nation, and troops from other nations - including Albania, Armenia, Azerbaijan, Bosnia, Bulgaria, the Czech Republic, Denmark, Georgia, Japan, Kazakhstan, South Korea, Latvia, Lithuania, Macedonia, Moldova, Tonga and Ukraine -- have completed their missions in the country.
Still, security gains in some areas of the country are fragile and reversible. For example, officials said, while overall deaths dropped, assassinations increased, and Iraq's Ninevah province and areas in Diyala remain as problems.
Iran continues to pose a "significant threat" to Iraq, the report says.
"Despite persistent promises to the contrary, Iranian behavior continues to reflect a fundamental desire to oppose the development of a fully secure and stable Iraq," the report reads. "Countering malign influence and balancing soft Iranian influence remain priorities to stabilize Iraq and ensure the sovereignty of its people."
Iraqi security forces - while improving - need to work on what the military calls "combat enablers," officials noted. Coalition forces still provide the Iraqi forces with logistics, fire support, communications, close-air support, planning and intelligence, surveillance and reconnaissance.
The gains in security allow the coalition to concentrate on infrastructure in the nation, officials said. The Iraqi economy grew by 9 percent in 2008, according to International Monetary Fund figures.
The 2008 Iraqi budget was $72.1 billion. The government is investing in quality-of-life projects, and also is working to counter unemployment and under-employment in the nation, officials said.