Satellite project prepares for lift-off after Barcelona deal

Date: 21/03/02

By Laurence Frost

GOVERNMENTS are set to give the go-ahead for the EU's ambitious space project next week when they release

€450 million in overdue funding to begin development of the Galileo satellite navigation system.

After months of wrangling, transport ministers are expected on Tuesday (26 March) to sign up to the €3.4 billion programme, which will put 30 separate satellites into orbit.

Last week's economic summit in Barcelona hailed an emerging compromise on the project, which accountants PricewaterhouseCoopers predict will return €18 billion in benefits to the European economy.

The green light seemed inevitable once Germany dropped its objections to the Commission's plans last month, leaving the other two Galileo dissenters, the UK and the Netherlands, to choose whether to back the project or face losing a formal vote.

Although the two governments are still expected to raise doubts about possible conflicts of interest arising from private investors' involvement in Galileo's operating company, sources say neither is ultimately likely to withhold support.

Instead, UK transport minister Stephen Byers and Dutch counterpart Tineke Netelenbos are pushing for a further ministerial review of the programme at the end of 2003.

'There's no blocking minority any more so we're trying to seek a consensus,' one EU diplomat said. 'The feeling about Galileo is now very optimistic.'

Concerns about decision-making within the programme had combined with deeper worries over Galileo's commercial viability to prevent the launch of the development phase by its scheduled deadline last December. The breakthrough came after Loyola de Palacio, the transport commissioner, earlier this year agreed to drop explicit references to 'preferential treatment' for companies who invest in the programme at an early stage (European Voice, 7 February).

The Commission is keen to encourage private investment in the project, and claims to have secured non-binding 'memoranda of understanding' worth a total 200 million euro in private investment for the development phase.

French companies Thales and Alcatel Space, Italy's Telespazio and Enav, Spain's Aena and consortium Galileo Industrie are among those understood to already have pledged contributions.

Thales and Telespazio are among eight hi-tech firms that this week launched a consortium to convince EU governments there is a market for the satellite programme. Companies from Spain and Belgium also signed the deal, setting up Galileo Services to promote the project.

Galileo's supporters claim it will bring revolutionary changes to transport, leisure, law enforcement and a host of other industries and activities, with accuracy far superior to America's Global Positioning Satellite - which is its only commercial rival so far.

Governments are set to give the go-ahead for the EU's ambitious space project on 26 March 2002 when they release €45 million in overdue funding to begin development of the Galileo satellite navigation system.