Germany is reportedly weighing Huawei 5G ban. China says it is ‘puzzled’

On Tuesday, Reuters reported, citing a government source, that Germany is considering banning certain components from Chinese firms in its mobile networks.

A paper by the German interior ministry which was obtained by Reuters said a specific supplier could be banned from providing critical components if it was deemed to be directly or indirectly controlled by the government of another state.

If the rules came into effect, it could mean ripping out equipment that is already installed in networks and replacing it with other suppliers, an interior ministry spokesperson told Reuters.

Huawei has repeatedly denied that it poses a national security threat.

A spokesperson for China’s embassy in Germany said late Tuesday that Huawei has operated in compliance with laws and regulations in the country and hit back at Germany’s stance, as reported by Reuters.

“In recent years, countries and anti-China forces have continued to attempt to smear Huawei with trumped-up charges, but there has never been any evidence that Huawei equipment and components pose security risks,” the spokesperson said, according to a Google translation. .

“If the report is true, the Chinese side is very puzzled and strongly dissatisfied with the hasty decision made by the relevant German government department without factual basis.”

The embassy spokesperson claimed that any ban of Chinese equipment in telecommunications networks “violates economic laws and the principle of fair competition.”

A Huawei spokesperson told CNBC that the company has a “strong security record” in Germany and globally for over 20 years.

“Huawei believes that there should be an objective and factual discussion about how risks in cyberspace can be mitigated,” the spokesperson said.

ZTE did not respond immediately to a request for comment when contacted by CNBC.

Germany’s position on Huawei has been in limbo since the US, under the Donald Trump administration, began to crack down on the telecommunications equipment giant.

Europe’s largest economy has sought a balancing act between business ties with China, it’s biggest trading partner, while weighing up geopolitical considerations.

Germany has looked to step up commercial links with China in recent months, with Chancellor Olaf Scholz visiting Chinese President Xi Jinping in November. However, it’s been under increased pressure from the US to take a harder stance on Beijing on technology.

Any decision to block Huawei from its 5G networks would mark a major shift from 2019 when the country said it wouldn’t make such a move. Since then, Germany has sat on the fence in regards to a Huawei ban as US pressure has ramped up and other countries have moved to block equipment from the Chinese firm in their networks.

5G is a key technology that has been thrust in the middle of a broader battle between the US and China over tech supremacy. 5G, which is the latest standard of mobile internet, is seen as crucial to supporting the next generation of infrastructure such as driverless cars but even has potential for military applications.