Mr Hague - who stressed he could not pre-empt the comprehensive spending review - said he was not intending that cuts would "have a dramatic effect on our role in world affairs".
He said he was flagging up with the whole of the government the "large unplanned" spending cuts the department had already been through over the past few years.
The FCO network was an "essential part of the infrastructure of this country for economic recovery" but there was scope for savings, particularly in areas where there were several offices, or where premises could be combined with the Department for International Development or the British Council.
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I'm not looking to have serious further reductions in the size of that network and I think it would be a major national error to do so”
End Quote William Hague Foreign Secretary
* 'No decisions' over World Service
The UK has 261 overseas missions - comparable to France's 279 - but while France had a budget of nearly £4bn to run them, the FCO managed on a budget half that size, he said.
"The entire spending on the Foreign Office, including the World Service and the British Council... is less than the spending of Kent County Council, so this country gets pretty good value for money from our overseas operations."
"If you closed the 40 cheapest posts... you would only save £2.5m, which is why whatever we have to do... it's quite unlikely one would chose the option of 'let's close dozens of posts'."
To save a large amount of money the government would have to close the more expensive posts - like Kabul or Baghdad - which was "inconceivable".
"Closing the small missions around the world is a false economy on the whole. That's not to say they can't sometimes be rationalised, that two countries can be served together from one central point.
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