Valdes told Barca last week he would not be signing a new contract when his current deal expires at the end of the 2013/14 season and the 31-year-old now looks set to move on after spending his entire professional career at the Catalan giants.
Iniesta said of his team-mate: "As a footballer, I don't like to see us lose Victor because for me he is the best goalkeeper in the world and he'll be really missed when he's gone.
"As a person, I respect and support his decision because everyone is in charge of their own life."
Regarding the reaction to Valdes' decision, Iniesta added: "When the news came out everybody was talking about it, but I would like to analyse it in a more neutral way.
"Victor started at Barca when he was 10 years old, he has come through all the youth categories and his work and actions on the pitch are indisputable.
"He's overcome difficult moments and has won five Zamoras (trophy given to the goalkeeper with the lowest goals-to-game record in the Primera Division).
We're not talking about just any player. We're talking about a player who has been here 20 years, who has given his life for the club, for his team-mates.
"It's not easy to say you won't be continuing at this club. It's a personal decision which he will have considered for a long time."
A host of names have been linked with the Nou Camp as possible replacements for Valdes, including Jose Reina, David de Gea, Thibaut Courtois and Maarten Stekelenburg.
Whoever it will be, Iniesta believes they have big shoes to fill.
"It will be difficult to find a substitute for him. Right now I'm not thinking about another goalkeeper. My goalkeeper is Victor and he will be until the final day that he's here," said Iniesta, who does not believe Valdes' decision will have an impact on the pitch this season.
"It's not news that's going to affect us. If things go badly it will because we haven't done well, not because of Victor," the Spain international told reporters.
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