G8 summit costs Russia nearly 400 million dollars

MOSCOW, July 14 (Reuters) Preparations for a summit of the Group of Eight leading industrialised nations in St Petersburg this weekend have cost Russia 10.7 billion roubles (398 million dollars), a senior summit official has told a Russian newspaper.

President Vladimir Putin will host world leaders including U S President George W. Bush in his home town of St Petersburg, where he grew up in an cramped flat and made his first steps towards a career as a KGB spy.

Leaders will gather in the glittering Constantine Palace, restored from ruins at Putin's initiative. Russian security forces have put a ring of steel around the palace with anti-aircraft missile systems and navy warships off shore.

''On all the preparations for the summit about 10.7 billion roubles has been spent,'' Sergei Vyazalov, head of the summit's secretariat, told the Rossiiskaya Gazeta in an interview to be published today, Interfax news agency reported.

''About half of the funds were spent on infrastructure in St Petersburg and a little more than 5 billion roubles was spent directly on the summit.'' Russia's first chairmanship of the G8 is seen by senior Kremlin officials as recognition of its newly found status, following the chaos that accompanied the fall of the Soviet Union.

Business sponsors contributed 160 million roubles towards the cost of the summit, Vyazalov said. He added that cost of security during the summit would not be made public.

Reuters SHB RS0901