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Weightlessness aboard the Blue Origin New Shepard, on July 20, 2021. Photo: EPA-EFE
Opinion
Editorial
by SCMP Editorial
Editorial
by SCMP Editorial

The sky is the limit for the emerging Chinese space industry

  • The real significance of the space exploits of Bezos and Branson may be to attract investment in the nascent global space industry for the private sector. And China now has the world’s best-funded and ambitious space programme with plenty of contracts to hand out to support the private sector
The space exploits of billionaires Jeff Bezos and Richard Branson this month have grabbed all the headlines and focused attention on space tourism. But their real significance may be to attract investment in the nascent global space industry for the private sector.

Long the exclusive domain of a small group of superpowers in competition for national prestige and technological domination, people are now seeing the great potential for private profits. As space technology defuses and more private funding is being committed, it’s no longer just about sending tourists into space or eventually to the moon, but the emergence of a full-spectrum industry.

A 2017 report by Bank of America Merrill Lynch estimates that the global space industry would be worth US$2.7 trillion by the end of this decade. China and its ambitious space entrepreneurs are right in the middle of it. A decade ago, when people talked about commercial satellite launches, they were likely to have been thinking about the China Great Wall Industry Corporation, which is a subsidiary of the state-owned China Aerospace Science and Technology Corporation. Today, there are an estimated 78 private space companies operating in China.

They are not as glamorous as billionaires travelling into space, but potentially highly lucrative. That is mostly thanks to two global technological trends: off-the-shelf satellites, which can be made cheaply and are lighter and smaller yet with greater transmission and data-processing capabilities than traditional satellites, and cheaper but reusable rockets and rocket boosters.

A Long March-3C carrier rocket blasts off from the Xichang Satellite Launch Center in southwest China's Sichuan Province, on July 6, 2021. Photo: Xinhua
The fact that since President Xi Jinping came to power, civil space development is considered on par with artificial intelligence and solar power for state industrial policy support has helped greatly. As a result, investment interest has helped reduce launch costs and spur innovation across related industries.

While state actors focus on the big and expensive infrastructure buildings such as the upcoming Chinese space station, colonising the moon and sending people to Mars, private companies will have a field day collecting hard-to-obtain data about Earth for paying customers on the ground.

In an age of climate change and weather-related disasters, insurance companies will want their own satellites to make specific forecasts to set policy premiums and determine claims. Construction companies with building projects in difficult terrains can turn 2-D radar data cheaply into highly accurate 3D satellite-imaging. Given China’s recent successes in 5G technology, supercomputers and artificial intelligence, facial recognition and high-speed rail, a world-beating space industry is a perfectly achievable goal.

China today has the world’s best-funded and ambitious space programme with plenty of contracts to hand out to support the private sector. For the emerging Chinese space industry, the sky is the limit.

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