(Corrects name of South Korean company in paragraph 10)
* Karel Havlicek starts as Czech industry minister on Tuesday
* Says security a key factor in both 5G and nuclear power
* But not acceptable to rule anyone out at this stage
By Jason Hovet
PRAGUE, April 30 (Reuters) - The Czech Republic should not initially rule out any Chinese or Russian companies from plans to build up new-generation 5G mobile networks or expand its fleet of nuclear power stations, new Industry Minister Karel Havlicek said in an interview.
After a cabinet shuffle, Havlicek is stepping into the industry post on Tuesday as the state pushes ahead with both projects that face security questions over the possible participation of China’s Huawei in 5G, as well as Russian and Chinese involvement in the nuclear expansion.
Havlicek said security would play a key factor in both sectors and warnings would not be ignored. But first, conditions for the expansions have to be outlined and discussion with key players should take place, he said.
“We have to evaluate all of the factors,” Havlicek told Reuters on Monday evening, before his official appointment to the government on Tuesday.
“But definitely it is not acceptable from the business point of view, and communication point of view, to in advance reduce the group of potential investors, potential suppliers,” he said.
In December, the Czech cyber watchdog NUKIB warned about possible risks from using Huawei equipment. The United States has also urged allies not to use Huawei products, saying they could enable Chinese state espionage - which the company denies.
Similarly, in nuclear power, a Czech government advisory body recommended last year security settings that would indirectly exclude Chinese or Russian suppliers in the multi-billion dollar expansion project.
The state is holding an auction for new 5G frequencies later this year, seeking to draw a fourth operator to the country to boost competition against O2 Czech Republic, T-Mobile and Vodafone and push down data prices, among the highest in Europe.
“I think the opportunity exists that a new multinational or Czech player is coming,” Havlicek said, adding there had been talks with around 10 interested parties, including American, South Korean, French and Czech.
The nuclear expansion has six potential bidders: China’s CGN, Atmea - a joint venture between Mitsubishi Heavy Industries and EDF Group - Westinghouse, South Korea’s Korea Hydro & Nuclear Power Co (KHNP), French state-owned Areva and Russia’s Rosatom.
Czech utility CEZ, which runs two nuclear power plants accounting for about half of its traditional production, and the state, its 70 percent shareholder, have been stuck for years over financing the construction of new units.
In February, Prime Minister Andrej Babis outlined a plan under which the state would control construction after signing a contract with CEZ. The state would then have power to halt the project if power prices don’t support it.
Havlicek said he hoped to have the contract with CEZ done in the autumn. (Reporting by Jason Hovet; Editing by Mark Potter)