China’s Huawei Technologies is facing ban on the supply of its 5G network equipment to telecom operators in New Zealand.
Earlier, Australia has also banned the China-based telecom network maker from supplying its 5G equipment to telecom operators. Recently, Huawei announced it signed 22 commercial contracts to supply 5G network to mobile service providers.

New Zealand’s intelligence agency has rejected a request from Spark, a telecom services provider, to use Huawei Technologies’ 5G equipment, citing concerns about national security, Reuters reported.

Spark New Zealand said on Wednesday it would review the reasoning before considering any further steps.

Australia, a neighboring country of New Zealand, banned Huawei from supplying 5G equipment, also citing security risks.

Last week, the Wall Street Journal reported the U.S. government was trying to persuade companies in allied countries to avoid Huawei.

“I have informed Spark that a significant network security risk was identified,” Government Communications Security Bureau Director-General Andrew Hampton said separately on Wednesday.

Intelligence services minister Andrew Little told Reuters that Spark – whose request was part of the country’s first 5G application – could work with the agency to mitigate risk.

“The difference between 5G networks and 4G and 3G networks is the configuration of the technology,” Little said. “With 5G technology, every component of the 5G network means every part of the network can be accessed.”

Huawei said in a statement that it will address any concerns and work together to find a way forward.

“We hope the New Zealand government provides a fair competition environment for Chinese companies operating in New Zealand, and does more to benefit bilateral mutual trust and cooperation,” Chinese Foreign Ministry spokesman Geng Shuang said in Beijing.

Huawei has been involved in other telecommunications systems in New Zealand such as its 4G mobile network, and is investing NZ$400 million or $271.88 million into research and development.

Telecom analysts believe that Spark rivals 2degrees and Vodafone New Zealand will be forced to reject 5G equipment from Huawei – putting pressure on the price of 5G network due to lack of competition without the presence of the China vendor.