Prime Minister Jacinda Ardern says New Zealand will pull its troops out of Iraq by June 2020 and will scale back its deployment of Defence Force personnel in Afghanistan by December of the same year.
Speaking at her weekly post cabinet press conference today, Ardern said when it comes to the mission in Iraq it was "time to go".
There are 95 non-combat Defence Force personnel in the Taji Military Complex – their job is primarily to train Iraqi Security Forces.
Following cabinet's decision, that number will be reduced to 75 next month, then to 45 in January next year. The remainder would withdraw by June 2020.
"Four years ago New Zealand made a commitment to the Iraqi Government and to the Coalition to train the ISF at Taji and lift their capability to defeat and prevent the resurgence of ISIS," Ardern said.
"Over the next 12 months, New Zealand will be able to wind down and conclude that commitment."
New Zealand forces were first deployed to Taji in 2015 as part of a multinational coalition with the goal of defeating ISIS.
Since then, however, the threat of ISIS has reduced significantly as the terror group has lost the vast majority of the territory it once had.
Close to 44,000 Iraqi security personnel have been trained at Taji since 2015.
Ardern said that "significant" progress has been made which will allow the mission to reduce in numbers having successfully achieved what the Defence Force went in to do.
Troops from Australia are stationed at the Taji camp alongside the Kiwis. Ardern said he has informed Australian Prime Minister Scott Morrison of the decision and he reacted "positively".
She said this is an issue both Governments have been discussion for a while and there had been "absolutely" no issues.
Ardern said there was a sense of "general understand" when it came to the way other countries operating in the region saw the move.
Defence Minister Ron Mark said the news that Kiwi troops would be pulling out was a success not only for the Defence force, but also for the Iraqi defence personnel.
Alongside the deployment to Taji, the New Zealand Defence Force will continue in a reduced number of support roles within the Defeat-ISIS Coalition in the region.
Cabinet will consider these positions again by next June.
New Zealand will, however, increase its stabilisation funding contribution to Iraq to roughly $3 million each year for the next three years to help affected communities recover and rebuild following the conflict with ISIS.
That funding had been $2.4m last year.
Since 2015, New Zealand has provided $7.75 million in development assistance to Iraq.
Ardern has also announced changes to the deployment of the New Zealand troops in Afghanistan.
New Zealand will change its deployment of the New Zealand Defence Force (NZDF) to the NATO-led train, advise, assist mission in Afghanistan by decreasing the number of personnel on the ground from 13 to 11.
The deployment will continue until December 2020 to support the training of Afghan Army Officers within the Afghan National Army Officer Academy, in partnership with the UK and others, but with a smaller number of personnel, Mark said.
Ardern also confirmed New Zealand's ongoing participation in the multinational information sharing and intelligence mission Operation Gallant Phoenix, based in Jordan.
The Government will extend New Zealand's mandate of a small number of personnel, fewer than 10, to the operation for 18 months until December 2020.
"New Zealand began participating in Operation Gallant Phoenix in late 2014 in support of our efforts to uncover information relating to the location of a New Zealander taken hostage by ISIS."
New Zealand has had a Defence Force presence in Afghanistan since 2001.