Portugal Space Day – Brussels,
November 11th 2015
The Space Industry: A Portuguese Sector with Potential and
the new challenges for Space in Europe
by António Neto da Silva, President of PROESPAÇO
A) PORTUGAL – Inside view
- Each Euro invested generates a spin-off factor of close to 4 on
the country’s income
- The value added per employee amounts to 4 times the national average
- The sector is a 100% exporter, without any imported intermediate
- Given the extremely high level of accumulated knowledge in our
Industry, with its being, in some areas, unique worldwide.
- On account of the exclusiveness of its technology and the projects
in which that technology constitutes the core element, it is the only sector
where Portuguese companies - generally small ones - subcontract giants
like Thales Alenia Space, Airbus Defence & Space, etc. Portuguese
companies take the prime role and we subcontract the European giants.
that framework, Portugal’s decision making politicians were called upon,
at an Interministerial meeting of the European Space Agency held November 2012,
to make strategic options that, as a consequence, would be decisive for the
future of the Space Industry in this country. Within a context of Public
Finances being hit by a severe crisis, it meant undertaking investment commitments
for the next three years (2013 -2015). That is to say, a pledge to subscribe
to the so-called ESA Optional Programs that would best adapt to the national
space industry’s requirements and response capability.
After more than a year of intense awareness initiatives conducted by
PROESPAÇO, aimed at sovereign bodies, Portugal’s political decision
makers came to the realization of how extremely important it is for Portugal
to participate in the ESA. This meant that they had grasped the decisive
need to invest by subscribing to its Optional Programs, thereby ensuring the
future development of an industry which, although unbeknown to ordinary citizens,
exerts a major influence on improving the quality of their everyday life -
quite aside from the fact that we are talking about investments with a guaranteed
return of well above the average. This is an industry that can boast
of being among the 6 most technologically-advanced worldwide, with Portugal
as a global leader in some of its niches.
It has already been established that all investments made in this sector on
an international level show a fairly short term return for the country and
its industry. In fact, each Euro invested generates a spin-off effect
of close to four on our national income. Aside from that, the gross value
added produced by each employee in this sector is four times higher than the
national average. In light of this reality, when the time came to decide on
the future of Portugal’s
Space industries, political decision makers took that on board.
Mindful of the financial difficulties that the country faces, PROESPAÇO
(Portuguese Association of Space Industries) asked the Government to restore
the level of state investment in ESA programs to that realized in 2005; in
other words, after a monetary correction, some €36 million for the entire
It is evident that whoever works in this business sector, a world leader in
technology, expects to see Portugal climb to higher levels of development in
future, with it investing the same percentage of GDP in Space as allocated
by more developed ESA countries. But right now, and at a time when the
State is in the grip of a financial crisis, it is, above all, vital to keep
it on the front burner – which is tantamount to saying how important
it is to safeguard investments and know-how accumulated throughout the past
fifteen years, going back to 2000 when the country joined the ESA.
That, therefore, entails safeguarding a business sector in which Portugal
has already achieved a high reputation for quality - acknowledged and praised
on the international stage. Furthermore, it constitutes one of the most
advanced technological sectors, served by some hundreds of technicians of exceptional
quality, of whom about one third hold PhDs. It is also a sector where
we would see them compelled to immigrate to other markets, resulting in the
throwing away of many millions of Euros invested by my country in their trainning.
Incidentally, the highly creative ability of our technicians has made this
sector a niche of excellence in Portugal.
The country has realized that it should maintain and bolster this capital
of quality and prestige, as it would make no sense to abandon a movement that
propels us toward the most ambitious of global cutting-edge technology programs,
which have an enormous impact on raising people’s living standards, even
if they themselves are unaware of that.
It is because the Space industries are engaged in constructing the intelligence
of satellites, as well as manufacturing the key hardware integrating them,
that we can access the solutions we utilize today; such as GPS/GALILEO
and the detection of illegal ships in Portuguese waters, or those of major
importance for the economy, such as timely alerts warning of the risk of forest
fires in identified areas, the advance of desertification or the optimization
of agricultural irrigation systems - just to mention but a few examples.
Portugal, in order to develop, must invest in this sector, which is one of
those with the highest income elasticity of demand worldwide. If the
signal sent out at the Interministerial Meeting in November 2012 failed to
meet the industry’s desires, it did however, in spite of everything,
represent an increase of 20% in the subscription made to Optional Programs
at the 2008 Interministerial Meeting. And in the mid-term InterMinisterial
2014 it was further reinforced by about €10 million.
This Sector, decisive for the technological upgrading of Portugal, does have
a future may Europe implement the right policies.
B) EUROPE – Trends and needs of Public Policy for
- Space is an area of excellence of Europe thanks to the
consistent and persistent investments of member States since the 60’s.
- European space industry (upstream) is small in
absolute and relative terms (38200 employees throughout Europe / 7,26B€ of
turnover) but it is performing well and demonstrates its competitiveness
on the commercial markets. Historically its sales are well balanced
between commercial and European institutional customers.
- Governance: Industry doesn’t care about public governance,
it can live with several customers and adapt to their various requirements
- There is a need for coordination between institutions:
make optimal use of public funds and avoid duplication of efforts
- There is a need to Ensure European value for European money (other
wording for a Buy European Act)
- European institutions must support industry competitiveness
- Competitiveness resides within companies organisation,
skills, motivation, strategy, etc...
- Competitiveness can be supported through adequate public R&D
policy, focusing on needs expressed by industry, targeting high
TRL (Technology readiness levels) developments
- European industry needs competent customers, knowing what
and determined to get it
- The role of public customers in space is evolving and new models
are arising (in the US)
- Less state-owned systems, even in launchers
- Institutions define their long term needs in terms of service requirements
- More initiative (and risks) are left to industry in the development phase
against long term commitments for procurement of services by institutions
- Is such model desirable for Europe?
- It allows for flat rate multi-annual budgets, which might be attractive
- It implies a massive transfer of risk toward industry provided it is
remunerated in consequence
- Is Europe ready to adopt such scheme?
- Not before long
- European domestic market is still weaker than
other space powers:
Europe makes little use of space resources as compared to other space
- The revision of the 2007
European Space Policy suggested by the Italian Presidency is to be considered
in light of such reflections
- However, in the short term some critical policy measures should
- Implement a full-fledged space industrial policy supporting
through space-specific procurement both the industry competitiveness
and European non-dependence.
- Reap the maximum benefits of EU investments in space by ensuring that
the transversal aspects of space are embedded into the various
future EU policies (e.g. telecoms, transport, environment, agriculture/fisheries
- Turn H2020 into an instrument promoting industrial leadership and
duly taking account of the industry’s needs to consolidate the share
of the global markets it has been able to grasp.
- Commit to the full deployment of the space and ground segments of both
GALILEO and COPERNICUS and put them in operational mode while devising
tools facilitating the market uptake of downstream services & applications.
- Foster synergies between space, security and defence in
line with the conclusions of the December 2013 Council for Defence and
promote efforts towards a future Space Surveillance & Tracking programme.
- Step-up EU engagement and political support to future international
initiatives for Space Exploration.
- Initiate long-term reflections on future possible ambitious programme(s)
of the EU in space.