All the potential of the space economy according to Intesa Sanpaolo
For Gregorio De Felice, chief economist of Intesa Sanpaolo, space offers many opportunities for businesses, even in those sectors not strictly linked to the space economy
“Space is a sector that continues to grow according to international estimates, in particular with regard to the satellite segment”. The words of Intesa Sanpaolo's chief economist, Gregorio De Felice, are confirmed by the research of the Space Foundation according to which the value of the space economy is constantly and continuously increasing. In 2023 the space economy was worth 580 billion dollars, up 30% compared to 2020. And it is a growth that does not stop. In 2027, according to estimates by the Space Foundation, the space economy will reach a value of around 800 billion dollars, marking a +40% compared to 2023. “The sector has high potential, some of the development trends concern space transport, earth observation , the lunar economy ,” continues De Felice, “and can have positive repercussions on the entire economic system. There are numerous spinoffs and effects on other economic sectors."
2,800 SATELLITES LAUNCHED IN 2023
Let's let the numbers speak. From 1957 until the end of 2023, over 17,400 satellites have been launched, with a significant increase in recent years. In 2023 alone, over 2,800 satellites were launched into orbit, reaching a new historical record. The space race involves more than half of the countries in the world: around 100 states have at least one satellite in orbit. The lion's share is played by the United States of America which in 2023 launched over 70% of the satellites. Italy, for its part, earns a more than honorable fifth place, positioning itself behind the giants USA and China, and the great powers United Kingdom and Russia. In recent years there has also been a renewed interest in missions to our satellite, the Moon. If until the Seventies the missions to the Moon were a derby involving only Russia and the USA, in the Nineties Japan appeared on the scene, in the early 2000s Europe, China and India also entered the lunar club . In the last four years, missions have brought the flags of China, Japan, India, Italy, Korea, the United States and Russia to the Moon.
Broadening your horizons to space exploration is a great opportunity for businesses. “Space offers new and multiple opportunities for businesses even for sectors not strictly linked to the space economy ,” explains De Felice, “even from the point of view of end-users there are many opportunities: the use of satellite data can be a element of development for the actors of the entire economic system. The available numbers updated to 2022 still show a limited diffusion of satellite data for data analysis within companies". This means that there is room for improvement to be exploited. According to NASA reports available since 2011, there have been around 500 spin-offs born from space-related activities, with positive impacts on various sectors. The most significant impacts concerned the industrial sector for the development of new materials, tools, new processes and the energy, environment and ICT sectors.
SHARING KNOW HOW
A more powerful development of the space economy can have positive repercussions in different areas. Let's think about space transport and in-orbit services, activities that will require the strengthening of launchers, the development of new systems to allow the reuse of structures and the construction of orbiting laboratories for experiments in microgravity. The sectors potentially involved range from the aerospace industry, with the manufacturing of aircraft and space vehicles, to manufacturing (electronics, mechanical processing, new materials just to name a few), to transport services/logistics services. The observation and monitoring of the Earth from space with satellite technologies ( Earth Observation ) also affects numerous areas: the satellite and telecommunications industry, the manufacturing of electronics, sensors, monitoring systems, and the development of software and analysis of data. Finally, imagining being able to go to the Moon to stay there, the so-called lunar economy can bring economic benefits to the infrastructure and construction sectors, for the creation of settlements, and energy, since there will be a need for systems to create and store energy , agriculture, because new cultivation systems will be necessary and, clearly, telecommunications.
Space exploration, therefore, offers great potential to companies but requires that they learn to work as a system, because never before has collaboration and the exchange of information and technologies been vital for success. “There are many opportunities but it is necessary create a system: participation in the space programs of large companies must be an opportunity to also involve all the smaller players , broadening the audience to non-space entities", continues De Felice.
ITALY, THE SUCCESS OF A DIVERSIFIED SUPPLY CHAIN
But, overall, how is our country positioned with respect to the space economy? The answer is not obvious and is, at the same time, surprising. “Italy confirms a good competitive positioning at an international level, the most updated data on world trade and patenting activity show how our country is among the leaders in the sector, occupying sixth place in the international ranking . Italy participates in various international initiatives and programs for space exploration, including NASA's Artemis Mission, which aims to return to the Moon to stay there." According to UnComtrade data, Italy, in the world ranking, ranks sixth among exporting countries in the space sector in the period 2015-2022, guaranteeing 4.2% of world exports .
It also occupies the same position when it comes to the registration of patents: our country is responsible for 3.2% of patents in the space sector. These are not insignificant results, especially if we consider that in front of us are industry giants such as the United States, France, Germany, the United Kingdom, Russia, China and Israel.
The results achieved by Italy are based on a diversified supply chain both in sectoral and dimensional terms, just think that more than half of the companies in the sector have a turnover of less than two million euros and that, within the different sectors (software, engineering, aircraft and space vehicles, just to name a few) that collaborate in the macro sector of the space economy, companies enjoy a very high technological content. “The good results achieved by our country are also linked to the presence of a complex and diversified supply chain (both in sectoral and dimensional terms) and also thanks to growing investments in R&D (both public and private)”, continues De Felice. Over the last 15 years, government spending on R&D allocated to space programs and companies in the aerospace sector has benefited from a generally positive trend, with declines, in both areas, linked to the contingencies of the Covid19 pandemic.
As we have said, in our country the supply chain is diversified, with large and small players , specialized in sectors with high technological content. It is essential to create a system: participation in the space programs of large companies must be an opportunity to involve even the smallest players , broadening the audience to non-space entities. “We need to encourage technological transfer between the different actors, and support the exchange of know-how between the world of research and industry, supporting an innovation ecosystem,” concludes De Felice.
TECHNOLOGICAL INNOVATION, SKILLS AND SHARING
The expansion of international competition to new players, with increasingly intense competition from emerging countries such as China and India, is one of the biggest challenges of the space economy for the coming decades. In this changing context, the European space industry must be able to carve out a viable space for itself. Our country must do the same. Italy must exploit to its advantage the kaleidoscope of skills it has and which it has been able to converge in the sector, overcoming the limits linked to the size of the companies involved. The solution lies in sharing know-how and the ability to work as a system. And then there is the theme, central above all for the European Union, of environmental sustainability to which the development of the space economy must also adapt. The Net Zero policy does not allow discounts.
Ultimately, it will be skills, investments in technology and the sharing of know-how that will lead to success those countries, companies and international entities that will be able to take up the challenge of space without being stopped by dizziness.
(The article was published in the latest issue of Start Magazine 's quarterly)
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/space-economy-gregorio-de-felice-intesa-sanpaolo/ on Sun, 11 Aug 2024 06:40:01 +0000.