SHERBROOKE, QUEBEC

Canada's government on Friday dismissed China's warning of repercussions if Ottawa banned Huawei Technologies Co Ltd from supplying equipment to 5G networks, saying it would not compromise on security.

China's ambassador to Canada issued the threat on Thursday as relations between the two nations continued to deteriorate after a senior Huawei executive was arrested in Vancouver last month on a U.S. extradition warrant. China has also detained two Canadians.

Canadian officials are studying the security implications of 5G networks, the latest generation of cellular mobile communications, but their report is not expected in the immediate future, a source familiar with the matter told Reuters on Wednesday.

Some Canadian allies have already imposed restrictions on using Huawei equipment, citing the risk of espionage. Canadian Public Safety Minister Ralph Goodale, asked at a cabinet retreat about the Chinese ambassador's remarks, said Ottawa had already made clear it would not cut corners on national security.

'We understand that those sorts of comments will be made in the process, but we will make our judgment based on what is right for Canada and not be deterred from making the right decision,' he told reporters.

'We are determined to stand our ground based on what is right for Canada ... this is a tough and turbulent world.' Goodale noted that China had made similar comments after Australia banned Huawei from supplying 5G equipment last year.

Western intelligence agencies have for years raised concerns about Huawei's ties to China's government and the possibility its equipment could be used for espionage.