David Cameron: Britain still a world force

The Prime Minister will insist the country is still "at the centre" of major global decisions and remains a "great economic power" and a key military force.

But, making his first annual Mansion House foreign affairs address, he will concede that the UK has lost "respect" because of the state of the national finances which must be won back.

Mr Cameron has just returned from a trade mission to China and the G20 summit of world leaders in South Korea, at which he denied Britain had been sidelined.

The coalition Government has also been under sustained fire from ex-military chiefs who believe cost-cutting measures in the armed forces will seriously weaken the country's capabilities.

He will use the speech to reject any notion that Britain is falling behind and to promise a foreign policy "focused like a laser on defending and advancing Britain's national interest".

According to extracts released by Number 10, he will say: "What I have seen in my first six months as Prime Minister is a Britain at the centre of all the big discussions.

"Producing the ideas, consulted for our experience and respected for the skills we bring and our capacity to find solutions. So I reject the thesis of decline."

Addressing the state of the nation's finances, he will say that addressing the record deficit "is as important a foreign policy priority as it is a domestic one.

"We need to sort out the economy if we are to carry weight in the world. Economic weakness at home translates into political weakness abroad.

"Economic strength will restore our respect in the world and our national self confidence.

"So the faster we can get our domestic house in order, the more substantial and credible our international impact is going to be."

Fellow world leaders though did not see Britain "shuffling apologetically off the world stage", Mr Cameron said.

"On the contrary, they respect our determination to get our economic house in order so we can remain masters of our nation's destiny."

Addressing the defence cuts, he will point out that Britain still had the world's fourth-largest military budget and was the second-biggest contributor of forces in Afghanistan.

"In terms of our role in the world, the truth is that many other countries would envy the cards we hold," he will say.

Mr Cameron will hail both a "deep and close relationship with America" and a "strong and active" membership of the European Union.

Not many countries enjoy Britain's "unique inventory of assets" such as the English language, the BBC, "world-class" universities, a "vibrant and tolerant society", the "buccaneering spirit" of expat communities and a place "at the heart" of key international institutions, he will add.

"Even fewer have the ability to make best use of them."

The Prime Minister will conclude: "We have to be more strategic and hard-headed about how we go about advancing our national interests. Our foreign policy is one of hard-headed internationalism - more commercial in enabling Britain to earn its way in the world once again, more strategic in its focus on meeting the new and emerging threats to our national security.

"And firmly committed to upholding our values and defending Britain's moral authority even in the most difficult of circumstances.

"Above all, our foreign policy is more hard-headed in this respect: it will focus like a laser on defending and advancing Britain's national interest."