Spying row: Merkel urges US to restore trust at EU summit

Germany's Chancellor Angela Merkel has said it is "really not on" for friends to spy on each other, after allegations of US snooping on her phone calls.

She said she had given that message to US President Barack Obama when they spoke on Wednesday.

Speaking after the first day of an EU summit in Brussels, Mrs Merkel said France and Germany wanted to hold talks with the US to settle the matter.

Other EU leaders also voiced concern about the scale of US surveillance.

The spying row threatens to overshadow EU talks on economic growth and migration to the EU. Mrs Merkel has demanded a "complete explanation" of the claims, which came out in the German media.

She grew up in former communist East Germany, where secret police surveillance was pervasive.

Earlier on Thursday, her delegation in Brussels confirmed she had met briefly to discuss the issue with France's President Francois Hollande, who has expressed alarm at reports that millions of French calls have been monitored by the US.

There is concern that the furore could jeopardise EU-US talks on reaching a major free trade deal. The head of Germany's Social Democrats (SPD), Sigmar Gabriel, said such a deal was hard to imagine if the US had infringed citizens' privacy. The SPD is in coalition talks with Chancellor Merkel.

'Unacceptable'

In a separate development, Italy's weekly L'Espresso reported that the US and UK had been spying on Italian internet and phone traffic.

The revelations were sourced to US whistleblower Edward Snowden. It is alleged that the US National Security Agency (NSA) and UK spy centre GCHQ eavesdropped on three undersea cables with terminals in Italy.

Italian Prime Minister Enrico Letta described the allegations as "inconceivable and unacceptable" and said he wanted to get to the truth of them.

Meanwhile, the Guardian newspaper reported that the NSA had monitored the phones of 35 world leaders after being given their numbers by another US government official. Again Edward Snowden was the source of the report.

Dutch Prime Minister Mark Rutte said the alleged spying on Mrs Merkel's mobile phone calls was "serious" and added: "I will support her (Merkel) completely in her complaint and say that this is not acceptable - I think we need all the facts on the table first."

Finland's Prime Minister Jyrki Katainen echoed him, saying: "We have to get clarification of what has happened and we also need a guarantee that this will never happen again, if it has happened."

Germany summoned the US ambassador in Berlin over the alleged spying.

Foreign Minister Guido Westerwelle said about his meeting with US envoy John Emerson that he had demanded straight answers from Washington, warning that their friendship is at stake.

Mrs Merkel discussed the issue with President Obama on Wednesday. He told her the US was not monitoring her calls and would not in future, the White House said.

However, it left open the question of whether calls had been listened to in the past.

Former US secretary of state Madeleine Albright said the spying allegations were "not a surprise to people - countries spy on each other", and added that France had spied on her when she was in government.

Cutting red tape

The formal agenda for the summit focuses on efforts to consolidate Europe's fragile economic recovery and to create a single market in digital services.

British Prime Minister David Cameron will also call on the EU to reduce regulations for business.

But France's President Hollande pressed for the spying issue to be put on the agenda.

The veteran French EU Commissioner Michel Barnier told the BBC that "enough is enough", and confidence in the US had been shaken.

Mr Barnier, the commissioner for internal market and services, said Europe must not be naive but develop its own strategic digital tools, such as a "European data cloud" independent of American oversight.

The digital economy is on the official summit agenda for Thursday evening.

One of the key initiatives of the European Commission is its Digital Agenda for Europe, which it says "aims to reboot Europe's economy and help Europe's citizens and businesses to get the most out of digital technologies".

Council officials say investment in the digital economy is vital to boost growth, which is creeping back to the European economy. They want to address market fragmentation and a perceived shortage of IT skills.

Mr Cameron is likely to use the economic discussion to raise what Britain sees as a proliferation of red tape.

He said last week: "All too often EU rules are a handicap for firms," and that small business owners "are forced to spend too much time complying with pointless, burdensome and costly regulations".

The European Commission - which makes the rules - has recognised that it may have gone too far in some places.

President Jose Manuel Barroso says he wants the EU to be "big on big things and smaller on smaller things".

He says the Commission has cut more than 5,000 legal acts in the past five years and wants to do more.

On Friday the leaders will discuss relations with central European countries, ahead of a November summit in Lithuania where new agreements will be signed.

Migration will also be discussed, following the loss of hundreds of lives among migrants trying to reach Europe from Africa and the Middle East.