Below is a transcript of an article by ESPI Director H. Ludwig Moeller in “Rotary Magazine for Germany and Austria“, released on 01 January 2025. The article is re-published here with the permission of Rotary.de, translated from German to English
Space and its use for the economy, and for security and defence are at the core of the national strategies of the US and China and of those of emerging space powers such as India. Donald Trump: “You can’t be number one on Earth if you’re number two in space.”
For the moment, Europe cannot claim the status of a space power. While a leader in space applications for Earth observation, navigation and meteorology, the continent is trailing behind dramatically in two critical areas that are at the heart of the global space powers’ space policy: human spaceflight and safety / defence, including the dual use of space. In light of the role played by space in the Ukraine war and the development of a global space economy and commercial space stations, it is of the utmost urgency for Europe to assume a new strategic posture in space.
This is a matter of nothing less than Europe’s place at the table in the internet age of space. Mario Draghi’s report on the future of European competitiveness dedicates an entire chapter to space, and makes reference to the analysis “More than a Space Programme” by ESPI and BCG. The report highlights the systemic significance of space. It mentions the size of the space sector, estimated at approx. 500 billion USD worldwide, as well as the benefit for the overall economy in areas such as pharma, biotech, digital, agriculture, energy, automotive and in enhancing the efficiency of existing markets and developing new ones.
In a similar way to semiconductors, a multiplier effect of six to seven can be attributed to space. This, with a conservatively estimated annual growth of 5% by 2040, would correspond to a value of up to 8 trillion USD. Such predictions are fraught with uncertainties, as was the case when the internet was first commercialized 25 years ago, but it is safe to assume that China, the US and India will strategically exploit this potential.
It must be Europe’s goal, proportionate to its economic performance, to harvest 25% of this economy. 55 years after Apollo 11, Space Race 2.0 has only just begun. There is still time to hop on board and pick up the pace – but this opportunity will only be available for a maximum of two to five years.
The security dimension of space is continuously gaining in importance. Globally, the proportion allotted to security and defence financing in governmental space budgets is more than 50%, i.e. around 54 billion USD in 2023. From the very beginning, there was a duality in the use of space, and far beyond its immediate military use, space increasingly contributes to societal and economic resilience, to the protection of critical infrastructures, e.g. in the digital sphere and in communication, transport and energy, to a safe food and water supply, to the safety of the environment with increasing natural catastrophes and to the civil security at large.
Europe still has the industrial fabric for this today and, according to the Global Talent Competitiveness Index, is home to the highest concentration of talent: seven European countries, with Switzerland in the lead, are among the ten best in the world. These countries can boast a high output of new innovations and an education system that is closely adapted to the requirements of the economy.
Moreover, Europe is unrivalled when it comes to space applications: in Earth observation with EU’s Copernicus programme for monitoring climate change (among other things), in navigation with the Galileo system and in meteorology with the EUMETSAT missions. In charge of the successful implementation of such complex programmes is the European Space Agency (ESA), with its systems, technology and services sourced from the European industry, which is built on a long-standing tradition and is increasingly also stimulated by new players in the field of New Space, start-ups and SMEs.
In order not to miss the boat, however, Europe must commit to a clear space policy with ambitious goals for both the economy and defence – and for the continued development of the independent and competitive European space industry necessary to do so. This needs to be translated into a space strategy that integrates the dual-use character of space, in synergy with the increasing commercialisation of the sector that can be expected based on the latest developments in the US with Donald Trump, Elon Musk and the designated future head of NASA, Jared Isaacman.
At the same time, the public share of investments in space – currently 85% worldwide – will, alongside increasing private funding, continue to be a central driver of future developments. It would be presumptuous to conclude that, in the face of the commercialisation of space, it will be driven primarily by the private sector. Even SpaceX, at its core, is based on NASA contracts for human spaceflight and contracts from the Pentagon.
At present, Europe is investing a mere 0.07 % of its GDP or 14 billion EUR per year in its space activities, almost exclusively in the civil domain. The US is investing roughly five times this amount via NASA and the defence sector.
The investment required by Europe to turn the additional value of space into a reality for Europe too is estimated at 0.15 to 0.25% of the European GDP by 2040, depending on the economic and security policy objectives. The needs in the contexts of defence and dual use are of crucial significance here, most likely as the only game changers that can still secure Europe’s relevance within the global space sector. Germany in particular must step up. As it stands, Europe’s biggest economy is currently only investing half as much money into space as France, with this trend in fact decreasing.
Developing a comprehensive European space strategy will be an ambitious endeavour in a Europe with increasing national priorities, in which approx. 80% of public space funds are anchored in national budgets, processed predominantly via ESA, including the participation of UK, Norway and Switzerland.
This is where the utilisation of space comes to the fore, in particular for the Nordic countries with the geopolitical significance of the High North, for Eastern European countries bordering war zones and for countries with a special interest in the Atlantic or the Mediterranean countries that are directly exposed to conflicts in the Middle East and Africa. Effective cooperation requires the alignment of national priorities and an increase in investments with the simultaneous strengthening of Europe’s economic and geopolitical position in the world.
Space also becomes an instrument of diplomacy, as the US and China have demonstrated impressively; the former with the Artemis Accords and the latter in many parts of the world. Europe’s existing alliances could be made use of to further strengthen Europe’s influence through space and to drive forward industrial growth and a higher trading surplus. Europe has the chance to build on its reputation as a trustworthy partner in many parts of the globe, a valuable asset when the world is confronted with an increasingly complex, competitive and multipolar environment.
Today, Europe’s activity in space is based on a multitude of different and in part competing strategies that reflect the complex structure of European (space) policy between national, intergovernmental and supranational contexts. It is imperative to make Europe capable of immediate action within these structures, as the geopolitical changes leave no time to establish a desirable, more uniform environment – whereby this should, however, remain a goal for the medium term.
Europe is called upon to live up to its role in the world and put into practice the benefit of space for prosperity, peace and security. Germany, along with France and Italy, will play a significant role in this regard.