US authorities have accused Huawei of spying with US President Trump ordering American firms to cease doing business with Huawei over the espionage concerns
German chancellor Angela Merkel told lawmakers on Wednesday that there was "no pressure" from China to include Huawei in Germany's 5G system.
"I have not heard about any pressure from Chinese state authorities," Merkel told the German Parliament.
US authorities have accused Huawei of spying with US President Trump ordering American firms to cease doing business with Huawei over the espionage concerns. China has repeatedly denied the charges.
China is Germany’s largest trading partner, with 200 billion euros in bilateral trade per year. It is the largest market for German automaker Volkswagen, Daimler, BMW. In fact, 34 per cent of Volkswagen's global sales were in china during January and November.
"I'm against excluding a single company but I'm in favour of doing everything we can to ensure security," Merkel told German politicians in Parliament.
Earlier, China’s ambassador to Germany, Wu Ken broke his silence on the issue and warned Germany could face retaliation.
"If Germany were to take a decision that leads to Huawei's exclusion from the German market, there will be consequences, the Chinese government will not stand idly by."
After the US pulled the plug on Huawei, Australia and Japan stepped up efforts to bar Huawei from 5G rollout, with UK PM Boris Johnson hinting that his country could follow the US example.