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US-China Rivalry Spurs Investment in Space Tech

The US is “in a space race with China to go back to the moon”, says Nasa chief Bill Nelson.

In a BBC interview, Mr Nelson says he wants to make sure “we get there first”.

His comments revive memories of the 1960s and 1970s, when Nasa was in a space race with the Soviet Union. But half a century later, Nasa is employing private companies to do much more of the work.

Mr Nelson says they are crucial because it allows for the huge costs to be shared, and for Nasa to draw on “the creativity of entrepreneurs in the private sector”.

He points to Elon Musk’s SpaceX, which in 2021 was awarded a $3bn (£2.4bn) contact to build a lunar lander, and has also developed the most powerful rocket ever built.

Other private firms are also feeling the benefit of the space race. Earlier this year the agency signed a $3.4bn deal with Jeff Bezos’ Blue Origin – also to build a lander, but for later moon landings.

Those are just two companies that are benefitting from billions of dollars of government funding. It’s money that is being spent, in part at least, to try and keep ahead of China amid much broader tensions between the world’s two biggest economies.

In late August, India became the fourth nation to achieve a soft landing on the Moon and the first to reach the lunar south pole region.

Despite that success, China’s space program is the one most closely watched by Nasa.

China is the only country to have its own space station, it has already brought moon samples back to earth, and it has plans to reach the polar regions of the lunar surface.

This worries Mr Nelson: “What I’m concerned about is that we find water on the south pole of the moon, China gets there, and China says this is our area. You can’t come here, it’s ours.”

Mr Nelson argues that China’s actions to build artificial islands in order to claim sovereignty over parts of the South China Sea support his concern.

Mr Nelson also points out that China has not signed up to the US-led Artemis Accords, intended as a framework for best practice in space and on the Moon.

China says it is committed to the peaceful exploration of space, and has previously dismissed US concerns about its space programme as “a smear campaign against China’s normal and reasonable outer space endeavours”.

The rivalry is spurring huge investment by Nasa. In the year to the end of September 2021 the agency says its spending was worth $71.2bn to the US economy – a 10.7% increase on the year before.

While big names like SpaceX might attract the headlines, Nasa’s spending reaches much further into the economy.

“A quarter of our spending is going to small businesses,” says Mr Nelson.

That money can accelerate the growth of small firms, particularly start-ups, says Sinead O’Sullivan, a former Nasa engineer and now space economist at Harvard Business School.

The government often acts as a first customer to start-up firms and those contracts can allow them to approach private investors and raise even more money, she says.

“A lot of the time we talk about venture capital and private equity, however, governments are equally if not more important,” Ms O’Sullivan says.

Source : BBC