French people's debt exceeded in mid-2005 the sill of 62 percent of their available incomes, compared with 40 percent in Italy and 100 percent in Germany, the Bank of France was quoted as saying Wednesday.

French households' debt increased by 13 percent in ten years, and 5 percent since the end of 2003, as the government encouraged them to borrow loans to boost the country's economy.

The rise is attributed to many factors: low interest rates, less exigent banks, and fiscal incentives implemented by former Economy Minister Nicolas Sarkozy in favor of consumption loan, which rose 6.2 percent in 2003 and 8.6 percent in 2004, according to the bank's latest figures published in French daily Le Monde.

French people's savings fell to 15.6 percent from 17 percent several years ago, said the central bank.

"French Finance Ministry favors a lot the continuity of the households' borrowing loans, thinking that we would have a room for maneuver to indebt our households," said a head of the bank, pointing out that the number of over-indebted cases doubled between 1995 and 2002 and further increased by 30 percent between 2002 and 2004.

According to a study made by the European Savings Institute (OEE), French households' indebtedness is 30 percent lower than the European average, with 11,147 euros (about 13,153 U.S. dollars) per habitant in 2004, far behind the Dane, 40,000 euros (about 47,200 dollars), and the Dutch, 33,000 euros (about 38,940 dollars).

House loans represented on the average 61.1 percent of European households' debts in 2004, the biggest goal of loans in every European countries, said the OEE.

More than a quarter of French households (27.7 percent) have borrowed consumption loans, much less than the British people (49.3 percent) but much more than the German (15.8 percent) and the Italian (10.1 percent), said the OEE.

Source: Xinhua