BAGHDAD (AFP) - US Defence Secretary Robert Gates hailed on Thursday the "extraordinary" progress made in Iraq as an example for Middle East democracy, but warned that neighbouring Iran and extremist groups would try to exploit unrest sweeping the region. Gates, who arrived in Baghdad Wednesday evening, met with Lieutenant General Lloyd Austin, commander of US military forces in Iraq, before going into talks with Prime Minister Nuri al-Maliki. At the Camp Liberty US base west of Baghdad, the Pentagon chief met with some of the nearly 50,000 US troops still in Iraq. That number is down from a peak of more than 170,000 after the US-led 2003 invasion to topple dictator Saddam Hussein and ahead of a planned full withdrawal in late 2011. "To see Iraq today -- and when you look at the turbulences going across the entire region -- lots of these folks would be happy if they could get to where Iraq is today," Gates told reporters. "It's not perfect but it's new and it's a democracy and people do have rights." Since February, Iraq has seen its share of nationwide protests. But unlike the uprisings sweeping across the Arab world Iraqis have not been demanding regime change, just reform and better living conditions.