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Europeans Deride U.S. Launch Industry as 'Xenophobic'
By Frank Sietzen, Jr.
Special to SPACE.com
posted: 07:09 pm ET
18 July 2000

Europe Takes Critical View of U

WASHINGTON -- Is the U.S. an unfair competitor whose trade policies leave European launch companies out in the cold?

International Trade in Commercial Space Launch: Issues
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The issue has launch industry advocates in Washington and European capitals fuming as some decry America's growing dominance in the launch trade, which last year was estimated to be a $16 billion annual business worldwide.

In a short span of years, the U.S. has become a major player again in commercial space transportation. After years in which emphasis on the space shuttle cost U.S. rocketmakers both market share and profits, revamped U.S. space policy, plus aggressive sales efforts by American firms have made transportation to space a hot business segment.



"The current U.S. commercial space policy? Unpredictable, ambivalent, parochial, protectionist, paranoid and xenophobic!"
     

Boeing's Delta Launch Services, Sea Launch consortium and Lockheed Martin's International Launch Services group, bolstered by a new-generation launch-vehicle design paid for by the U.S. Air Force are repeatedly winning contracts once secured by such firms as Europe's Arianespace. This new U.S. rocket fleet, all based on the Pentagon-funded Evolved Expendable Launch Vehicle (EELV) will form the basis of U.S. industry's commercial launchers for the next decade, and possibly longer.

But just as important as the designs of the new rockets are the regulatory and policy atmospheres in which they operate. That climate, some in Europe are saying, is what is really wrong with American space launch at the dawn of the 21st century.

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One critic of U.S. space launch policy, Adjunct Professor of Law Peter van Fenema of McGill University, put his blast at the U.S. into a book and lectures both here and abroad.

It's stirred up quite a buzz in the rocket community. And what "buzz-words" would van Fenema use to describe the state of the U.S. launch industry?

"The current U.S. commercial space policy? Unpredictable, ambivalent, parochial, protectionist, paranoid and xenophobic!" he said from his office at Leiden University in the Netherlands where he teaches at the Institute of Air and Space Law there.

"I guess those harsh qualifications need some explaining," he quipped.

Van Fenema doesn't believe that U.S. rocketmakers compete unfairly. "But they operate in a regulatory environment which gives them a number of advantages unavailable to their competitors abroad," he suggests.

That environment plays on what he called legitimate concerns about U.S. national security to foster what amounts to protection of American launchers in their competition for customers.

Van Fenema points to the recent congressional uproar over Chinese space-launch technology transfer as one such issue. "The conditions which China has to meet to earn the right to launch a U.S.-built satellite are mainly trade-related," van Fenema says. "This strongly suggests [the law] has been used as a means to protect U.S. jobs, improve the balance of trade and open up the Chinese market for U.S. [rocket] industry in general," he added.

Seeing America as using national security concerns to cloak protectionist tendencies isn't just the Chinese view of the U.S., van Fenema says. "Most U.S. allies conclude this effectively neutralizes the Chinese launch industry as a competitor of the U.S. companies, but also discourages the use of any foreign launch-service provider for the launch of U.S.-built satellites."

His review of recent changes in U.S. satellite export regulations -- amendments to the International Traffic in Arms Regulations (ITAR) -- hints at a superpower that "apparently feels surrounded by 'rogue countries' which are out to steal U.S. jobs and U.S. satellite and launch secrets," van Fenema claims.

The result? "All non-U.S. launch companies and their U.S. and non-U.S. clients, including insurance companies, have experienced serious delays and uncertainties," whenever dealing with U.S. satellites or components. Those tighter regulations and restrictions are virtually choking U.S. commercial space, van Fenema suggests, in the reverse effect of what was intended.

And while recent congressional action has been taken to lessen the effects of last year's reaction to the export issue, he suggests that the reasons are frivolous. Such changes "only serve to reinforce the impression that both Congress and the Clinton administration overreacted in the first place and that a mere change in mood or second thoughts may lead to a change in export policy -- and thus launch policy."

The Clinton space-launch policy of 1996 confirmed that U.S. law was aimed at "free and fair trade in commercial launch services," as a goal of the U.S.

If that is really true, van Fenema says, then the U.S. should terminate launch quotas and price controls now imposed on Chinese, Russian and Ukrainian rocketmakers through bilateral trade agreements. The three sets of agreements that govern what U.S.-made space hardware can be launched on these foreign boosters begin to expire this December.

So how could change make for a more even playing field?

"The U.S. would be a better partner with Europe [in space launch] if it could be less paranoid about the national security risks of talking with Europe about common safety and reliability concerns," he suggests. After all, van Fenema recalls, space launch "is an unsafe, risky activity." Customers insist on reliable, flexible and affordable launch services.

The price for a boost to space won't likely drop substantially until space tourism begins to flourish, van Fenema believes. "All of the above argues for more cooperation and more competition in the field of international launch services," he said.

That translates into sharing of safety-related data, development of safe and reliable engines for rockets and a more open, competitive policy environment. That will require the U.S. to distinguish between real security issues and free and fair trade principles.

All aimed to "please the customers" for launching services. "Sounds as American as apple pie," said van Fenema.


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