How the Global South developed its Space Industry
The inauguration of the African Space Agency (AfSA) on January 25, 2023 heralded a decades long push for a continental agency to direct space affairs within Africa. In this series, Kwaku Sumah examines the stated aims and goals of the agency, and asks, is it possible for the AfSA to achieve its stated aims as designed?
Read the previous Part One, Two, Three, Four, Five
Read the next Part Seven
1.1 Latin America
In contrast to the previous regions examined, Latin America is on a more comparable level of development as Africa, and therefore serves as an interesting case-study.
Space activities in the region date back to 1961. However, South American countries have achieved modest capability through their national programs and international collaboration, with space activities led primarily by the Brazilian and Argentinian space programs.[1] Individual countries have developed some space capacity to provide basic services and enable small autonomy, with several governments developing (or aiming to develop) their own missions. Ultimately however, hosted payloads and shared infrastructures seem to prevail.
To date, there has been no common organisation or supranational organisation with space on its agenda in the Latin American region. In 1997, a Regional Centre for Space Science and Technology Education for Latin America and the Caribbean (CRECTEALC) was established with to focus on space education. In 2006, the idea of a South American Space Agency was first proposed at the America’s Space Summit, and then in 2011 it was agreed during a meeting between Defence Minsters of UNASUR. However, progress was largely halted for several years. In October 2020, Mexico and Argentina agreed to lead the creation of the Latin America and Caribbean Space Agency (ALCE), consisting of 16 other Latin American and Caribbean countries. Brazil is notably absent, and although Colombia and Peru will not be actively participating, they will be part of the group as observers.[2] ALCE aims to launch satellites for satellite imagery, increasing investment in space research, and creating projects to boost satellite internet; with their most ambitious goal being participating in the Moon and Mars missions.
The goals of ALCE and motivations behind it reflect those of the AfSA. The Member States of ALCE are similarly unable to compete individually in the global space arena, most involved countries lack the industrial base, the technical, political, and institutional capacity, and the funds to invest into the agency. As a result, the ALCE faces the same problems that the AfSA does, with added uncertainty coming from the fact that budgets in Latin America are on a downward trend – the Ecuadorian Space Institute was shut down in 2018, and even Mexico which is leading the creation continues to reduce its investment in science and space research.[3]
The ALCE also largely ignores the role of the private sector. As a result, I expect the impact of the ALCE to not be very significant, if and once it is actually implemented.
1.2 New Zealand
The last region I would like to highlight is New Zealand (NZ). NZ serves as a vivid example of how quickly a nation can develop its space capabilities and ecosystem when approached with NewSpace in mind.
In a very short amount of time, NZ has risen to be an important player in the space arena. In 2018, the NZ space economy was valued at U.S.$1,75 billion by Deloitte,[4] approximately 1/5th of the estimated total value of the African space economy in 2019, and had an economic contribution of U.S.$1,6 billion to New Zealand as a whole, contributing 5.000 full-time equivalent (FTE) jobs, to a total of 12.000 FTE when including indirect effects.[5]
So how is it that the NZ ecosystem grew in value so rapidly, especially compared to the African ecosystem that as a whole has been involved in space for much longer?
A few factors have been crucial for the growth of NZ:
The NZ space economy is at its core NewSpace driven. While other space economies are now transitioning from legacy operational models of centralised coordination of all space activities (as outlined in the previous sections), NZ immediately focused on NewSpace market structure and business models.
NZ and its Space Agency focus on providing an attractive business and regulatory environment. In 2020, NZ was ranked as the top country in the world for doing business.[6] The NZ Space Agency, set up in 2016, established a tax and regulatory environment to support the safe and secure use of space from NZ, and made it flexible and pragmatic enough to respond to future changes in market structure.[7]
The success of Rocket Lab has led to spill-over benefits for the NZ economy. Established in 2006 with a launch base in NZ, Rocket lab created a demand for space components and parts that were predominantly self-supplied or supplied by 1.700 NZ-based suppliers.[8] The success of its private investment led to other spill-over benefits from its operations, including attracting international talent and supporting the local ecosystem. Rocket Lab also invested in educating schools and the general public about satellites and the benefits of space data and access.
NZ leveraged its high-tech manufacturing sector, strong R&D capability within its universities, and experts with transferrable skills from adjacent industries to support upstream and downstream activities. The downstream sector in particular grew due to the public demand for space data.
NZ has a good mix between local and international talent. NZ’s space economy is largely home-grown – more than 50% of their workforce are New Zealanders[9] – however it has managed to build close relationships with international space agencies and organisations.
NZ’s location provides it with an advantage for the launch sector, as it has the largest selection of azimuths for rocket launches, as well as low levels of air traffic, which allows it to provide frequent launches to satiate global demand for satellite launches.
Ultimately NZ has positioned itself as an attractive destination for space start-ups and large international companies to do business. African nations as a whole could learn a lot from NZs growth.
Part Seven examines what African can take away from all these regions.
Kwaku Sumah
Kwaku is the founder of Spacehubs Africa, and has been active in the space industry since 2016, working as a consultant for European and African space institutions and companies. He has worked on projects across the entire space value chain, including analysis on downstream markets, space debris evolution, planetary defence, and the launch market; as well as an assessment of the European financing landscape and due diligence on space companies.
[1] Bruno Victorino Sarli et. Al, “Review of Space Activities in South America”, Journal of Aeronautical History, Revised 11 September 2018, Paper 2018/08, https://www.aerosociety.com/media/9320/review-of-space-activities-in-south-america.pdf.
[2] Convenio Constitutivo de La Agencia LatinoAmericana y Caribena Del Espacio. https://aplicaciones.sre.gob.mx/tratados/ARCHIVOS/convenioconstitutivo.pdf.
[3] Valero, Myriam Vidal, “Latin America’s Moonshot”, 6 May 2020, Slate https://slate.com/technology/2021/05/latin-american-caribbean-space-agency-future.html.
[4] Deloitte, “New Zealand Space Economy: Its value, scope and structure”, 2019.
[5] Ibid.
[6] World Bank Group, “Doing Business 2020”, https://openknowledge.worldbank.org/bitstream/handle/10986/32436/9781464814402.pdf.
[7] Ministry of Business Innovation & Employment, “Space-related opportunities in New Zealand”, https://www.mbie.govt.nz/science-and-technology/space/space-related-opportunities-in-new-zealand/.
[8] Deloitte, “New Zealand Space Economy: Its value, scope and structure”, 2019.
[9] Ibid.