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Russia will slash another 5 percent off the cost of constructing sites and infrastructure for the 2014 winter Olympic games in the Black Sea resort of Sochi, Deputy Prime Minister Dmitry Kozak said on Wednesday.

"While previous assessments provided for 206 billion roubles (4.02 billion pounds), as a result of optimising costs we now have 195.3 billion roubles," Russian news agencies quoted Kozak, who is in charge of preparations for the Sochi Olympic games, as saying.

He said this had included finding cheaper solutions, without sacrificing the project, Interfax reported.

Sochi's victory over Austrian and South Korean rivals in a competition to run the 2014 winter Olympics has been used by the Kremlin as a symbol of Russia's national revival after years of post-Soviet political and economic turmoil.

The Russian leaders, buoyed by continuous economic growth on the back of high energy prices, in 2007 initially pledged to invest $12 billion -- or 318 billion roubles at the then exchange rate -- in the ambitious project.

Despite the global economic crisis, which has cut oil prices to around $60 from $140 per barrel and forced Russia into the first budget deficit in 10 years, the government has pledged to press ahead with preparations for the Sochi games.

The devaluation of the Russian rouble to 31 roubles per dollar from some 25 roubles has made imported goods more expensive. But a fall in domestic prices for construction materials and labour, which make up the bulk of expenses, have made officials optimistic about chances to cut actual costs.

In March, Kozak put the building budget for the Sochi Olympics at 218 billion roubles, which apparently was reduced at least once more before Wednesday's announcement.

Kozak said 102 billion roubles of the projected costs will come from the budget, while private investors will pay the remaining 93 billion.

(Source: Reuters)