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GALILEO GPS IMPORTANT FOR EUROPE!

At first sight the two events appear to be totally unconnected. Scarcely 60 days in office and the new US President, George W. Bush, announces that his government will not be ratifying the Kyoto agreement negotiated by the Clinton government which stipulates a reduction in global CO2 emissions for environmental reasons. According to the White House, this measure was being taken to protect American jobs which would be endangered if the climate protection agreements were implemented.

A few days later the transport ministers of the European Union issued the go-ahead at their meeting in Luxembourg for the development and building of the Galileo satellite navigation system, which should enter service in 2008. But the two events are connected with each other. They show that in a functioning democracy (fortunately) governments can change, and with them stances on policy issues. It is a normal part of everyday political life that agreements which have not yet been ratified are overturned by new governments or that signed intergovernmental agreements are reversed.

In the matter of satellite navigation, up to now the world has been dependent on the American Department of Defense, for it is the Pentagon that operates the Global Positioning System (GPS), the only satellite navigation system for which there are a multitude of commonplace everyday applications. There is a rival system in the Russian GLONASS, but this has not caught on and to all intents and purposes can be ignored.

The US government under the former President Bill Clinton improved the signal accuracy for civilian users of GPS and issued a declaration that there were no plans to limit the use of GPS in any form. As it happens, this declaration was issued just when the EU originally announced its intention to implement Galileo.

If the Europeans want reliable satellite navigation, then they have to develop their own system, which according to the latest estimates will cost around EUR 3.2 billion. The market potential for Galileo products and services is huge. An EU study estimates the overall economic benefit to the EU countries from Galileo at EUR 74 billion by the year 2020. That is an attractive market which will create a number of jobs.

In the meantime, financing of Galileo has not yet been finalised. While the French and Italian governments prefer that the satellite system is funded entirely by the state, other governments, including the German government, would prefer industry to be involved in financing the project from the start.

To enable work on the system, which eventually will comprise 30 satellites, to continue, the EU transport ministers in Luxembourg have granted EUR 100 million of launching finance. The European Space Agency (ESA) is contributing an equal amount.

By the end of 2003 industry must find some EUR 1.6 billion for the Galileo project to proceed according to plan. If these funds cannot be raised, the entire programme will be endangered. The satellite manufacturers under the programme leadership of Astrium cannot raise the missing funds alone, nor do they wish to do so, as they are only building the satellites. They may well be the first ones in the Galileo value-added chain but those who will be the main beneficiaries later on include the motor and telecommunications industries, as also medium-sized manufacturers of navigation software and Galileo receivers. Yet so far these groups have shown little inclination to become involved in the funding. Their position is clear: accurate data is available free of charge from space using GPS today, hence in their opinion the Europeans do not need their own system. Yet just how rapidly this could backfire on them is illustrated amongst other things by Bush's announcement that he will not be ratifying the Kyoto agreement.

From page 4 of FLUG REVUE 6/2001