German leader Angela Merkel has said she will hold talks with France on creating “safe communication networks” in the EU in the wake of the US spy scandal.

She said in her weekly podcast on Sunday (16 February) that: “We will speak to France about this and about all things regarding what kind of European providers we have who can offer security for our citizens: So [that] we don't even have to go with our emails and other information over the Atlantic, but that we can set up safe communication networks within Europe.”

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Merkel and Hollande have reacted differently to the NSA affair so far (Photo: elysee.fr)

She noted the EU is currently in talks on a new data protection law, due to be agreed by the end of the year.

But she added: “It is not so easy to negotiate because some countries have less data protection than Germany and we don't want our data protection to be watered down. On the other hand, [US firms] Google or Facebook, of course settle where the level of data protection is lowest and we can't welcome that in the long run in Europe.”

The Chancellor, who is to meet French President Francois Hollande in Paris on Wednesday, made the comments in the context of the Edward Snowden revelations that America’s National Security Agency (NSA) and the UK equivalent, the GCHQ, snoop on EU citizens and EU leaders.

The former NSA contractor said the US has “unfettered” access to European people’s data held by US companies.

Merkel’s comment comes after she tried, and failed, to get the US to agree to a “no-spy” pact with Germany on the model of its “Five Eyes” alliance with Australia, Canada, New Zealand, and the UK.

It also comes amid calls by some German politicians to suspend talks on an EU-US free trade agreement in reaction to the scandal.

German weekly Der Spiegel also on Sunday reported that Germany’s domestic intelligence service, the BND, and its military intelligence, the MAD, plan to conduct new counter-intelligence operations against the UK and US.

It said they will screen IT technology and diplomatic staff in American and British embassies in the same way they approach Chinese and Russian missions.

Meanwhile, Germany’s main communications provider, Deutsche Telekom, says it is already doing research on an “Internetz.”

Its idea is to use European-made hardware and software to make sure people’s data do not go on US-exposed systems. It says the new network could cover the 26 countries in the Schengen zone, an EU passport-free travel area, which excludes the UK.

But for his part, Hollande has taken a more sanguine view of the NSA affair so far.

When he met US President Barack Obama in Washington last week, he said: “Following the revelations that appeared due to Mr. Snowden, we clarified things, President Obama and myself clarified things.”

“Mutual trust has been restored,” he added.

“The five countries, the US, UK and others, they have their own rules, or so I understand. We’re not within that framework and we don’t intend to join,” he said last October on the Five Eyes club.