BERLIN, July 10 (Reuters) - The German government and

mobile phone carriers have agreed in principle on steps to phase

components by Chinese technology companies out of the nation's

5G wireless network over the next five years, two people

familiar with the matter told Reuters on Wednesday.

Newspaper Sueddeutsche Zeitung as well as broadcasters NDR

and WDR earlier jointly reported the news, saying the agreement

gives network operators Deutsche Telekom, Vodafone ( VOD )

and Telefonica Deutschland more time

to replace critical parts.

Under the preliminary agreement driven by security

considerations, operators will initially rid the country's core

network of 5G data centres of technology made by companies such

as Huawei and ZTE (Shenzhen:000063) in 2026, said the

sources, adding that a final pact has yet to be signed.

In a second phase, the role of Chinese makers' parts for

antennas, transmission lines and towers should be all but

eliminated by 2029, they added.

Asked for comment, Germany's interior ministry told Reuters

that the government's talks with mobile carriers were ongoing.

"The government is acting on the basis of the national

security strategy and China strategy to reduce possible security

risks and dependencies," a spokesperson said.

The Chinese embassy in Germany did not immediately respond

to a request for comment.

Germany is considered a laggard in implementing the European

Union's security measures for 5G networks.

Telecoms operators in the country have previously resisted

Berlin's efforts to drive the expensive phase-out of Huawei,

while Huawei has rejected what it called the "politicisation" of

cyber security in the country.

Reflecting the costs of a transition, the U.S.

communications regulator said in May that nearly 40% of U.S.

telecom companies need additional government funding to remove

equipment made by Chinese telecoms firms from American wireless

networks to address security risks.

(Writing by Ludwig Burger, additional reporting by Sarah Marsh;

Editing by Rachel More and Emelia Sithole-Matarise)