Together with the European Space Agency and Europe’s investment arm, the European Commission is partnering with them to help more space companies secure funding, including from a multibillion-dollar fund for strategic investments that is currently largely untapped.
The European Commission, European Space Agency (ESA), and European Investment Bank (EIB) signed a tripartite agreement on January 24th to streamline access to the range of financial resources available in the region to expand its space ecosystem.
The Strategic European Security Initiative (SESI), a five-year, 8 billion euro ($8.7 billion) fund launched in 2022 for investing in strategic assets primarily for security and defense purposes, is one of the main ways the European Investment Bank (EIB) currently makes space investments.
According to a bank representative, the EIB has approved approximately 2 billion euros in funding under SESI to date, but only 5% of this funding has been designated for space, despite the industry’s growing strategic importance.
As Europe aspires to become more sovereign to overtake the US and other non-EU countries, space is one of the main priority areas under SESI. Europe is getting ready to contract a broadband constellation by the end of March, one of these capabilities.
However, Timo Pesonen, director-general of the European Commission for Defense and Space, stated that financing remains difficult for the industry even with efforts to support domestic space projects.
As part of their alliance, the three European institutions are organizing frequent meetings to exchange information about bottlenecks in space financing.
According to an EIB spokesman, to facilitate and expedite their access to debt financing, the organization would also actively seek out promising European space projects and provide them with financial advice through EIB advisory services.
Additionally, to eventually facilitate more PPP space projects in the EU, they plan to exchange best practices in public-private partnerships.
The partnership follows the launch of a 175 million euro equity fund for defense investments that could benefit space by the European Investment Fund, the branch of the European Investment Bank that focuses on startups and small-to-medium-sized enterprises (SMEs).
A one billion euro seed and growth fund is part of Europe’s Cassini space entrepreneurial initiative.
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