China Threatens Retaliation Against Ericsson if Sweden Doesn’t Drop Huawei 5G Ban

Beijing is giving Sweden one last chance to reverse its ban on telecommunications-equipment giant Huawei Technologies Co., a Chinese state media outlet said, before it could retaliate against rival Ericsson ERIC 0.69% AB.

Ericsson’s participation in the next round of China’s massive 5G build-out is linked to whether Stockholm changes its stance on Huawei, according to the Global Times, a Chinese Communist Party publication.

Swedish regulators banned wireless carriers from using the Chinese company’s 5G equipment in October, citing national-security concerns. Huawei is challenging the decision in Swedish courts, with a ruling expected in the coming weeks.

A spokesman for Stockholm-based Ericsson declined to comment. A spokesman for Sweden’s foreign-trade ministry didn’t respond to requests for comment. Ericsson shares were down nearly 4% Tuesday, trading slightly lower than its peers amid a broadly lower tech market.