How can Europe finance its space ambitions?

After a profound transformation of the space industry in the last decade, The European model, based mainly on public support, has become obsolete in an emerging economy where the US, China and India prosper.

“This model is no longer suitable for today’s competitive global space economy,” says the latest EU report on the single market, prepared by former Italian president Enrico Letta.

Most industrial resources are now concentrated in a few countries and companies with the capacity to build, launch and operate large space systemswhich hinders growth and fragments Europe’s potential in the world market.

“We are far behind everyone else and we shouldn’t spend so much time trying to imitate what is already out there in terms of technologies“Reinhilde Veugelers, a senior member of the Brussels-based economic think tank Bruegel, told Euronews.

“Europe has to ensure that it has a innovation system that works well, because there are many inventions that are not only dedicated to space, but come from other technologies,” he added.

According to Letta, if Europe wants to compete and achieve strategic autonomy, needs to stimulate the injection of private capitalintroduce common standards and balance the distribution of funds between different space activities and countries.

“Divide and conquer” is not applicable

Until now, the European Space Agency (ESA), made up of most EU countries plus Canada, Norway, Switzerland and the United Kingdom, has operated on the principle that any investment made by a member is matched proportionately through contracts with its domestic industry.

An approach that has worked well for space exploration, but that may not be the best for commercial space. “Here we need the best long-term results, and whoever can offer them must obtain them,” argues Veugelers.

If this is done through consortia of several European companies of different sizes and knowledge, so much the better.

“With our hiring, in Europe we should definitely avoid ending up in a war in which everyone subsidizes their own actors“says the Bruegel researcher.

Instead of dividing efforts by retreating to the national level, a joint push could be a better path for European space economy.

“[Para crecer]maybe we have to think about cooperative models and in the so-called sector of risk sharingwhich may not be as profitable, but it would allow Europe to have independent access to space and be competitive outside Europe,” Xavier Llairó, co-founder of Pangea Aerospace, which develops rocket engines, explains to ‘Euronews’.

Speed ​​up the game

For ESA Director General Josef Aschbacher, working on agile procurement procedures should be part of the European recipe for success in the next years.

“This is something that worries me, [el hecho] about what Europe does not have the same speed and volume when it comes to attracting financing“Aschbacher told Euronews during the recent meeting of space ministers in Brussels. ESA’s agenda for 2025 reflects these concerns, with commercialization and capital attraction industry at the top of the list.

“For me, it takes three ingredients to be successful: a good idea, access to money and speed,” Aschbacher argued, adding that Europe already has the necessary capabilities and talent.

However, the sector has traditionally been risk averse and has failed to attract financial instruments. “We do not want to displace the private investors. We would like to push where necessary,” says Helmut von Glasenapp, Secretary General of the European Association of Long-Term Investors (ELTI), which represents public investors such as national development banks and others. financial institutions.

But, in general, these public investors have both defense and security excluded from their mandate. space. “Governments have to say I think we need more investment in space and defendingand the second step is who should do it,” von Glasenapp stressed.

Focus on strengths

Europe’s access to space runstemporarily in charge of SpaceXof Elon Muskone of the most profitable start-ups in the world, which currently leads the global launch services market.

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According to Bloomberg, the company is debating the sale of existing shares in an operation that could value it at around $200 billion (€183.94 billion).

“This is a company that can raise between one and two million euros a year from private investors, so we are talking about a different scale,” said Llairó, stressing that he believes that Europe is already late for these larger projects.

But since space is a sector in which technology is linked to profitability, The block could focus on the development of efficient engines at an affordable and competitive price, he says. In this case, public investment could support the development of the core of the launchers, the engines, and then private investment could help expand the rest.

The Bruegel researcher also sees scope in space manufacturing, where small and medium-sized businesses can play a key role in European and international supply chains.

“With a little vision and the development of the right tools, I think we can get back into the global race,” predicts Llairó.

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