Following reports that the U.S. government eavesdropped on the phone conversations of 35 world leaders, particularly German Chancellor Angela Merkel, Berlin is considering setting up its own Internet system to prevent a repeat of foreign espionage.

Deutsche Telekom urged other German telecom companies to cooperate to shield Germany's Internet traffic from foreign intelligence services such as the National Security Agency.

The confirmation of eavesdropping came from NSA leaker Edward Snowden, however, U.S. President Barack Obama denied to Ms Merkel the claims of spying, but the chancellor was reportedly angry about the report.

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Duncan, a consultant to Der Spiegel which reported the espionage, said it was accomplished by using listening installation located on top floors of the U.S. embassy, protected by investigation by diplomatic immunity. Duncan identified their locations in Berlin and other European capital cities from Stockholm to Athens.

However, while Germans are very security conscious, an Internet system of its own would mean citizens can no longer access social media sites like Facebook or search engines like Google since these two portals are hosted in the U.S. Such models of iron curtains are more common in countries like Iran and China.

Dan Kaminsky, a U.S. security expert, warned that if more nations wall themselves, it would render ineffective the openness and efficiency of the Internet that made the Web a major source of economic growth.

Torsten Gerpott, professor of business and telecoms at the University of Duisburg-Essen, told Reuters, "It is internationally without precedent that the internet traffic of a developed country bypasses the servers of another country."

He added that the suggestion of Deutsche Telekom, which is 32 per cent owned by the German government, is laudable, but more of a public relations move than a practical solution.

Besides Germany, Brazil is also considering building its own email system so the NSA could no longer spy on it.

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