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This decision cost Australia $12 billion: report

Huawei 5G telco equipment has been banned in Australia and the US. (Images: Getty)

A government ban on a Chinese technology firm has cost the Australian economy $11.9 billion (US$8.2 billion), according to a new report paid for by the company.

The Australian federal government, along with the US, has banned telecommunications equipment maker Huawei from supplying equipment to new 5G mobile networks. The US is pressuring other like-minded nations – such as the UK – to do the same.

The prohibition is based on security concerns that the company leaks information and data to the Chinese government. The Wall Street Journal last month even claimed Beijing had granted the company as much as US$75 billion of financial assistance.

Huawei has always denied such accusations and predicted the Australian ban alone would cost 1,500 jobs.

Huawei this week publicised an Oxford Economics to write a report called Restricting Competition In 5G Network Equipment, which the company commissioned.

The document has claimed the loss of Huawei from the market would mean rural Australia will miss gaining 5G technology in the near future.

This would lead to a significant loss for the economy, according to the report.

"Restricting such a significant player from bidding for 5G contracts will lead to higher prices, rollout delays and hence a slower diffusion of associated technological innovation," said Oxford Economics associate director Henry Worthington.

"For Australia, the resulting loss in productivity has significant economic consequences. Lower economic growth due to delays in 5G rollout and the associated slower technological growth reduces GDP by US$8.2 billion in 2035."

Australia's fourth largest telco, TPG, last year abandoned its plans to roll out a 5G network because of the Huawei ban.

"In the 5G side, [Huawei is] in front of everyone else," TPG chair David Teoh told Reuters last year.

"To replace [Huawei] there are few vendors to select."

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