The US State Department warned that Al-Qaeda affiliates pose a rising threat exploiting poverty and upheavals in the world's most vulnerable regions even as the core network is on the decline.

In its Country Reports on Terrorism 2011, the department also branded Iran "the world's leading sponsor of terrorist activity" providing funds and support "for terrorist and militant groups throughout the Middle East."

Both Iran and Al-Qaeda are helping to foment unrest by spreading "violent extremist ideology and rhetoric" in some of the world's most restive regions.