Osama bin Laden's second-in-command says Britain's handover in Basra shows insurgents are gaining the upper hand.

In a video, Ayman al-Zawahri said: "Reports from Iraq point to the increasing power of the mujahideen (holy war fighters) and the deteriorating condition of the Americans and the decision of the British to flee is sufficient proof of this."

Al-Zawahri denounced Sunni Arab tribal forces that the US has backed in the fight against insurgent groups, calling them 'traitors' to whom the Americans had paid bribes.

Talking about the American trained Iraqi forces, Al Zawahri said Iraqi forces were unable to keep security.

Iraq took formal responsibility for security in Basra province on Sunday.

The 4,500 British troops still in the country will now take a lesser role, focusing on training local security forces.

This is being seen as a key stage towards a final British withdrawal from the country.

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