French public debt in new high after stimulus spending

France's public debt has risen to a new high of 76% of economic output after additional state spending during the downturn, figures have shown.

The national statistics office INSEE said government debt stood at 1.46 trillion euros ($2.1tn; £1.3tn) at the end of September.

This was an increase of 29.4bn euros since the end of June.

Debt levels of all major economies have risen sharply as governments have tried to spend their way out of recession.

French government spending helped the country's economy to emerge from recession between April and June.

Lower tax receipts have also contributed to spiralling debt levels.

The 1.46tn euros is the largest debt France has run since INSEE records started in 1995.

According to forecasts from the International Monetary Fund (IMF), French public debt as a percentage of economic output will hit 96% by 2014.

Of the G7 economies, this is less than Japan (246%), Italy (129%), the US (108%) and the UK (98%), but more than Germany (89%) and Canada (69%), the IMF has predicted.

Greece votes for big budget cuts to reduce debt

The Greek parliament has voted to adopt big budget cuts designed to lower the country's high levels of debt.

Greece aims to shrink public debt to 9.1% of overall economic output next year, down from 12.7% this year.

To do this, it has outlined measures to cut public spending and boost revenue by cutting back on red tape.

Concerns about Greece's high level of debt have led the three main international credit ratings agencies to downgrade Greek government bonds.

Greece's public debt currently stands at 300bn euros ($428bn; £268bn).

The single-chamber parliament adopted the budget by a large majority, with the 160 Socialist Pasok deputies voting for, and 139 opposition members against.

One opposition member was absent.

Speaking after the vote, Prime Minister George Papandreou said the budget was "a contract to reconquer our credibility".

"We shall prove our capacity and determination to change this country, to ourselves and to any foreigner who puts in doubt our will," he continued.

Spending cuts

Last week, Mr Papandreou warned that the country was at risk of "sinking under its debts", unless it introduced spending cuts.

He outlined a number of measures to reduce debt levels, including a 10% cut in social security spending.

He also announced a 90% tax on the bonuses of senior bank workers.

Other proposals included a cut in defence spending, pay and hiring freezes for public sector workers, and the closure of a third of Greece's overseas tourism offices.