Ericsson, the world's largest maker of mobile network equipment, has insisted that it can continue to outpace its rivals – including China's Huawei Technologies – thanks to its cutting-edge technology.

Hans Vestberg, Ericsson's incoming chief executive, told the Financial Times that the Swedish company was well-placed to grow faster than the market in the coming years.

Like its European rivals, Ericsson is reporting falling sales of equipment because mobile phone operators in western and emerging markets are cutting back on capital spending in the downturn.

Alcatel-Lucent, the Franco-American equipment maker, expects sales of fixed-line and mobile network equipment to fall by 8-12 per cent this year compared with 2008, when the market was worth an estimated $100bn.

Ericsson's network equipment revenue dropped 8 per cent in the three months to September 30 compared with the same period last year. Group revenue fell 6 per cent in the third quarter. However, while Mr Vestberg declined to say if he expected sales of mobile network equipment to increase in 2010, compared with this year, he said: “Ericsson believes that telecoms is a growth industry . . . we definitely should be able to grow faster than the market.”

He forecast that the number of mobile phone users would increase from 4.5bn to 7bn in the next two years. Ericsson and Nokia Siemens Networks, the infrastructure unit controlled by Finnish mobile phone maker Nokia, remain the largest manufacturers of mobile network equipment globally. But Huawei moved up into third place last year. Mr Vestberg said Ericsson would not get distracted by a debate about whether it was competing on a level playing field with Huawei.

Huawei has denied receiving subsidies from the Chinese government. It said it had a $30bn credit line with China Development Bank that could be used by customers that buy its equipment.