AUSTRALIA has not harmed its relationship with Beijing by banning Chinese technology giant Huawei from helping to build a nationwide high-speed Internet network, Prime Minister Julia Gillard said yesterday, a day after China cautioned Australia not to discriminate against Chinese businesses.

Gillard said she would not comment in detail on "what ultimately are national security matters" but said the decision was correct and had not broken any international trade rules or agreements with China.

Gillard told reporters: "We've taken it for the right reasons through the right process based on the right advice about a piece of critical infrastructure for our nation's future."

The government late last year told Huawei Technologies Ltd it was barred from bidding for work on the A$36 billion (US$38 billion) network, The Australian Financial Review newspaper reported earlier this week.

The newspaper said the decision was prompted by Australian intelligence officials who cited hacking attacks traced to China.

On Wednesday, China's Foreign Ministry spokesman Hong Lei responded to the Huawei ban by urging Australia not to discriminate against Chinese companies.

"We hope the relevant authorities of Australia will provide a market environment for Chinese companies that is fair and free from discrimination, instead of wearing colored lenses and obstructing Chinese companies' normal operation in Australia in the name of so-called security," Hong said.

Source:shanghaidaily