The Italian government has prevented a deal from being made between Huawei and telecoms company Fastweb, in an obvious indication of Rome's unwelcoming position on the Chinese tech group.

The decision marks the first time that Italy has struck down a supply agreement over 5G core infrastructure with Huawei, sources with knowledge of the matter disclosed.

During a visit by United States Secretary of State Mike Pompeo to Italy in September, he described the Chinese mobile technology as a threat to the nation's national security.

Huawei has vehemently junked such accusations and its Italian subsidiary said it is prepared to be subjected to an evaluation to prove that its technology is not a cause for worry.

The nonacceptance of Huawei in Italy, experts say, follows the narrative of private determination through company boards, where individual governing bodies have emerged to set up security perimeters to safeguard their people from tech encroachment by China.

Despite Huawei's assertion that its hardware is safe, the Italian government employed its interdiction to keep Fastweb, the Italian unit of Swisscom, from getting its hands on Huawei technology.

Fastweb had recently picked the Chinese group as the exclusive supplier of hardware for its fifth-generation system, sources said.

"The government has blocked the operation, asking Fastweb to diversify its suppliers," Reuters quoted a senior government source as saying.

Analysts say Italy's cutting of ties with China over Huawei will be detrimental for Italy's $2 trillion economy. The economy of Italy has been static in the last 15 years, with its GDP fluttering between $1.7 trillion and $2.3 trillion.

Telecom Italia, Italy's biggest telecom company, sent out invitations in July to propose for 5G infrastructure - where sensitive data are processed - for its core network. Major telecom players were in attendance, except Huawei, who wasn't invited.

Policies set forth by the Italian government on companies using Huawei hardware on their 5G systems include prohibitions on remote interference to troubleshoot technical issues and a tremendously high security threshold, industry sources said.

Telecom players operating in Italy have unveiled a withdrawal stipulation in their 5G contracts with Huawei, enabling them to back out should the government demand for steep requirements in exchange for its approval, industry sources added.

Meanwhile, analysts say that as part of Chinese leader Xi Jinping's strategy, China will coax, or even threaten, Italian regulators with severe sanctions and forms of penalties, for which Italy must be ready for.