SpaceX Launch Successful: Is this the start of a space economy and what will govern it?

July 8, 2020

2 min read

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What's going on here?

Elon Musk’s private spacecraft company SpaceX recently launched two NASA astronauts onboard its Crew Dragon spacecraft to the International Space Station (ISS).

What does this mean?

This marks the first time a commercial spacecraft has successfully launched humans into outer space. After two fatal accidents under the Space Shuttle programme, the government decided to retire the initiative in favour of the Commercial Crew Development programme in 2010. This led to the outsourcing of the production of spacecraft and rockets, allowing NASA to focus on higher-value space missions into deep space. 

By utilising private capital, NASA can cut around $20-30m and avoid using taxpayers’ money. Morgan Stanley estimates that the revenue generated by the global space industry will increase to over $1tn by 2040 as technological advances, growing public-sector interest and government funding paint an attractive investment opportunity. 

There is criticism as to whether investment into the space industry will generate big returns, as sending humans to space is risky and complex. For Musk, his ultimate goal with SpaceX is to build affordable spacecraft to one day reach and colonise Mars. Unlike investors and other stakeholders, profit is not his motive.

What's the big picture effect?

In 1967, 129 countries signed a UN Space Treaty, also known as the Outer Space Constitution. This sets out the notion that space is a province of all mankind. In other words, outer space is free for the exploration and use by all states. The moon and other celestial bodies cannot be claimed by a sovereign nation-state and must be used for peaceful purposes. While some have argued this can be used as the basis for international space law, there lies the problem that the commercialisation of space was not anticipated by its original signatories. In 2015, the US Congress passed a law to legalise mining in outer space, allowing firms to process, own and sell anything they harvest from asteroids. However, this has been criticised by Russia saying the US is attempting to confer rights they have no authority to confer. Evidently, a clear international framework is required to navigate these grey areas. 

Space debris is another problem, unique to this space economy, that needs to be addressed. This is caused by the collision of objects in space splintering off, rendering the outer space environment useless. The Outer Space Treaty notes that even non-functioning satellites and space debris belong to the country that launched them. Guidance helping to identify the owner of splintered components of space debris will be needed for a space economy. There are also IP considerations. Moving space debris into a graveyard orbit (space bin) requires an in-depth knowledge of that space object, which tend to be guarded state secrets. Balancing the protection of state secrets and establishing an international framework to regulate the space economy will be difficult. Regulations on liability for damages occurring in space and a solid definition of “space debris” will also be required. 

With take-off for a space economy looking possible in the near future, the question will be whether an international community can come together to regulate a public good. If not, space may become a legal Wild West, where national interests can trump the common good.

Report written by Robyn Ma

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