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China said it strongly opposed Germany's interference in Chinese investments after Berlin ordered a review of Huawei and ZTE components in the country's 5G networks.
The Chinese embassy in Berlin expressed dissatisfaction over reports that Germany might ban Huawei and ZTE from its telecoms networks because of national security concerns. The embassy said it was "puzzled" and described the German government's decision as "hasty" and "without factual basis".
"China firmly opposes Germany's use of the concept of national security and its abuse of state power to interfere in the market in its cooperation with China," the embassy said in a statement.
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"[We] hope that Germany will create a fair, just, open and non-discriminatory business environment for Chinese companies, and do more to promote mutual benefit instead of the opposite."
The embassy defended the safety of Huawei's equipment, which is used in around 60 per cent of Germany's 5G networks.
Huawei equipment is used in around 60 per cent of Germany's 5G networks. Photo: AP alt=Huawei equipment is used in around 60 per cent of Germany's 5G networks. Photo: AP>
The German newspaper Zeit first reported the possible ban on Monday, citing government sources that said the ban could include Huawei and ZTE components that had already been built into the networks.
According to the report, the government has already spent months inspecting 5G network components that could pose a risk to national security.
The German interior ministry confirmed on Tuesday that the review had been carried out, but denied that it targeted any specific manufacturers.
But Reuters reported that Germany could ban "a specific supplier" from providing critical components "if it were deemed to be directly or indirectly controlled by the government of another state", according to a document it obtained from the interior ministry.
Countries such as those in the Five Eyes intelligence alliance, which consists of the US, Canada, Britain, Australia and New Zealand, have already banned Huawei from their networks because of national security concerns.
Calls have also grown in Germany and other EU countries to address broader national security concerns around key infrastructure involving Chinese investment.
Germany was harshly criticised last year for approving the state-owned China Ocean Shipping Company to become a shareholder in a firm that operates terminals at the Hamburg port, one of the busiest ports in Europe.