In the midst of a turbulent year for the global economy, the budgets of the state space programs maintained their growth trajectory for the fifth time in a row. This is shown by Euroconsult’s latest flagship study “Government space programs: benchmarks, profiles and forecasts up to 2029”. After a period of severe budgetary tension between 2010 and 2015, government space sector spending reached its highest recorded point in 2020. Since Covid-19 had no noticeable impact on government space budgets, the pandemic persisted with budgets already largely resolved to see if governments can maintain these historic budget levels in the future.
For the tenth year in a row, the expansion of civilian budgets has outpaced the military, totaling $ 50.2 billion in 2020. This is 61% of total global spending, 10% more than in 2007. The growth of civil space budgets is being fueled by the proliferation of new entrants, ambitious space exploration and manned space programs, and the attractiveness of a booming commercial market owned by governments encourages investing to help national industries capture part of this market.
Defense budgets are cyclical in nature, with the US continuing to dominate spending at 75% of total global spending, although other countries are increasing their investments, particularly China, Russia and France, although contributions from civilian powers like India are increasing. The government’s defense space budgets are driven by the current global upswing, the heavy emphasis on space security in all leading space nations – with a keen interest in SSA from leading and emerging space countries – and a general trend of space militarization.
“Unlike cyclical defense space budgets, civil spending is more susceptible to external shocks such as economic crises, falling oil prices, and shifting government priorities. Although we saw record-breaking space budgets in 2020, their sustainability in the current global economic context remains an open question. We will continue to monitor closely whether emerging space nations continue their commitment to national space policies and strategies or redirect investments elsewhere. Thanks to our new digital platform, which is updated quarterly, we can now provide our customers with fresher data faster, ”commented Simon Seminari, Euroconsult’s main advisor and editor-in-chief for Euroconsult’s Government Space Programs research product.
While the US remains the world’s largest investor in space with 58% of the world’s population, followed by China, France, Russia and Japan in that order, the proportion of the top 5 space circles investing in space has decreased to just 81 % of the world as a whole, compared to the top 5, which accounted for 93% of total spending 20 years ago. The U.S. space budget was $ 48 billion in 2020, while China retained its second place with an estimated budget of $ 8.9 billion, roughly a three-fold increase since the early 2000s. France has also continued to increase its space budget, surpassing Europe’s national spending to overtake Russia as the third largest investor with a budget of $ 4 billion for space in 2020.
The socio-economic benefits of space assets, as well as the rapid development of commercial space markets, have led more and more countries to invest in space. Despite this trend, the gap between emerging and mature space powers has widened significantly over the past decade and threatens to widen over the next decade, especially as the economic impact of Covid could force emerging economies to reevaluate, undo, or postpone theirs Investments in space to support their public finances.
In terms of space applications, governments adopted $ 13.2 billion in manned spaceflight, the $ 11.7 billion in Earth observation as the highest funded application in 2020, driven by ambitious missions in the US (Artemis), China Chinese Large Modular Space Station) and China was advanced India (Gaganyaan) as well as major investments by ESA, Russia and Japan among others. According to the research report, Space Science and Exploration is now the third-highest-funded application by governments, with next-generation orbital infrastructures and expensive space exploration missions, including three that launched in 2020 for Mars, largely driving the growth of the civilian space budget.
A number of competing forces make forecasting difficult. The economic consequences of Covid associated with the pandemic are likely to put pressure on national budgets. If commercial property markets fail to live up to expectations, there is a risk that governments will become disillusioned with their returns on capital and seek to channel money into other, more fertile sectors. Most mature powers, however, have committed to ambitious, multi-year space exploration and manned space programs, making it difficult to draw on investment, and the increasing militarization of space should support investment as well.