Huawei says it's working with Telecom Italia despite 5G exclusion - paper

MILAN (Reuters) - Huawei Technologies is working with Telecom Italia <TLIT.MI> despite being shut out of a recent tender to supply new generation 5G technology, the chairman of the Chinese group's Italian unit said in a newspaper interview.

Luigi De Vecchis said Telecom Italia's (TIM) recent decision to exclude Huawei from supplying new generation 5G services was a "commercial" decision, unlike in Britain where he said the Chinese telecoms group's exclusion from 5G services was a "geopolitical, not a technological decision".

"We respect the decision (by TIM), which is of a commercial not a political nature, that concerns one of the many parts of the network," De Vecchis said in an interview with Corriere Economia, the weekly business magazine of Corriere della Sera, published on Monday.

Telecom Italia this month left Huawei out of an invitation to tender for a contract to supply 5G equipment for core network infrastructure, where sensitive data is processed, in Italy and Brazil.

"Of course we're sorry, it's not a party but we continue to work with TIM as well as with Vodafone and others," De Vecchis said.

Huawei has played no role in the building of TIM's existing core network in Italy. However, the Chinese group has been providing Italy's former phone monopoly with equipment to build part of its current radio access network, the radios and antennas that connect smartphones to the mobile network.

The U.S. government has urged allies to exclude Huawei from their next-generation communications infrastructure because of the danger it could give China a strategic opening to spy on the West. Huawei rejects the charges.

Last year Italy passed legislation giving the government special vetting powers over 5G supply deals between domestic firms and non-EU providers, including Huawei, but has not gone as far as to ban the Chinese vendor.

"Italy is dealing with the cybersecurity issue in a professional manner," De Vecchis said, adding that Europe would suffer significant damage if it follows U.S. calls to exclude Huawei.

(Reporting by James Mackenzie, Elvira Pollina, editing by Gianluca Semeraro and Susan Fenton)