Andrew Little has warned Huawei not to threaten the New Zealand Government.
The Chinese company's New Zealand managing director Yanek Fan wrote to GCSB Minister Little and Communications Minister Kris Faafoi in July. In the letter - which was leaked to NZME on Monday - Huawei said if it continued to be prevented from working on 5G upgrades, it may pull out of the New Zealand market
In 2018 the GCSB rejected Spark's proposed 5G network using Huawei cellphone tower equipment, citing significant risks to national security.
Fan said Huawei was being singled out for its country of origin, yet other China-linked companies involved in 5G technology have not been subjected to the same level of scrutiny.
"This would have a significant effect on Huawei New Zealand's revenue, to the point where there is a real risk that Huawei New Zealand may not be able to continue to operate in the New Zealand market," the letter read.
Little says Huawei's going about things the wrong way, and has discouraged them from trying such threatening tactics.
"The way [Huawei] get to work out a place for them and enhance their commercial interest is to work with their client, in this case Spark," he told RNZ.
"It is not to work with the Government and try to leverage their commercial interest and commercial advantage by heavying the Government."
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Little told RNZ it's "not uncommon" for companies to threaten to exit the New Zealand market in an attempt to bargain for looser restrictions.
In May, Huawei NZ deputy managing director Andrew Bowater told the China Business Summit that the company had been "blindsided" by the GCSB's warning to Spark.
He said there's no evidence Huawei is a spy front for China's Communist Party, and if it was, the company would have been "kicked out a long time ago".
"Our staff here, our citizens, obviously don't have to comply with any Chinese law," he said.
"We have never, ever been asked to do anything by the Chinese government. We've never been asked to spy... and there's never been any evidence of anything malicious going on behind the scenes."