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Germany to phase out Huawei, ZTE components from its 5G core network

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BERLIN (Reuters) -Germany has closed a deal with telecom providers to exclude Chinese companies such as Huawei or ZTE from the nation's 5G network products from 2029, its interior minister said on Thursday.

"We have now reached a clear and strict agreement with the telecoms companies," minister Nancy Faeser told reporters in Berlin, hailing the deal as a crucial safeguard for digital security in Europe's largest economy.

The agreement follows talks between the interior ministry and Deutsche Telekom, Vodafone and Telefonica Deutschland, and aims to shield Germany's critical infrastructure from China, whose influence is seen as a potential security risk.

Faeser said Berlin had informed Beijing about the agreement and that she did not expect any retaliation over the planned curbs to Chinese technology.

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However, China's embassy in Germany said if Huawei were to be restricted or excluded it would not be without consequences, calling Berlin's plan a "ruthless attempt" to suppress competition and promote its own technology.

"Alleged risks to network security only serve as a pretext. The fact is: no country has yet provided conclusive evidence to what extent Huawei equipment poses a security risk," said the embassy on Thursday in response to a request for comment on reports on Wednesday about the plans.

The minister did not give further details on the agreement.

The planned phase-out, reported by Reuters on Wednesday, starts with a first stage in which operators will remove Chinese-made technology from the country's core network of 5G data centres in 2026.

In the second stage, Chinese makers of parts such as antennas, transmission lines and towers will be eliminated by 2029.

Germany is considered a laggard in implementing the European Union's security measures for 5G networks.

Telecoms operators have often resisted Berlin's efforts to drive the expensive phase-out of Huawei, while Huawei has rejected what it called the "politicisation" of cybersecurity in the country.

(Reporting by Andreas Rinke, Rachel More and Chiara Holzhaeuser; Writing by Madeline Chambers and Christoph Steitz; Editing by Arun Koyyur and Mark Potter)