Capital Markets: New Zealand space race rockets ahead

Space Minister Judith Collins speaks at the Space Foundation Space Symposium in the US last year.

• The space and advanced aviation sectors added over $2.5 billion to the economy last year, supporting 12,000 jobs with 27 companies based here.
• New Zealand was the first country to establish a private launch range and was the third-most prolific launching country in 2024.
• New laws will deter foreign interference in the space industry, with penalties for non-compliance.

After waiting for a Christchurch to Brisbane flight to pass, amateur rocketeers created history from a farm in Canterbury – and helped amplify the growing reputation of New Zealand’s capability in space.

The April 19 launch by the New Zealand Rocketry Association was believed to be the first amateur effort outside the US to reach space, crossing the Karman line at 100km above Earth.

New Zealand-founded Rocket Lab – with a market cap of $17 billion and investors from big players in space – is the headline act for New Zealand. The enthusiasts who launched the Meraki II funded it themselves. New Zealand is committed to doubling the size of its space and advanced aviation sectors by 2030, a message the Government emphasised at the recent Infrastructure Investment Summit.

New Zealand companies, including Zenith Tecnica, Dawn Aerospace, Kea Aerospace, Astrix Astronautics, KiwiStar Optics and Rocket Lab, are part of the revolution in the global small satellite industry, making sustainable space travel a reality, and developing technologies for Mars exploration, New Zealand Trade and Enterprise (NZTE) said at a global space event in the US last year.

With uncrowded air space making it an ideal test bed and launch site, the country soars well above its weight in activity and profile but commands just a fraction of spending in the global space economy.

A report released by Space Minister Judith Collins last Friday said the space and advanced aviation sectors added more than $2.5b to the New Zealand economy last year,

The Deloitte/Space TrailBlazer Innovation for Growth, Charting the Space and Advanced Aviation Sectors report showed the space sector contributed $2.47b to the economy in the 2023-24 financial year.

The advanced aviation sector, which includes emerging aviation technologies and overlaps with the space sector, contributed $480 million. “The report showed our fast-growing space sector with revenue increasing by 53% in the five years to 2024 – a faster rate than the world’s space economy,” Collins says.

Growth around the world is soaring.

McKinsey estimates that the global space economy will be worth US$1.8 trillion ($3t) by 2035, up from US$630b in 2023. This figure includes both “backbone” applications – such as those for satellites, launchers, and services like broadcast television or GPS – and “reach” applications, those for which space technology helps companies across industries generate revenues.

The growth drivers for the space economy identified by McKinsey include the need for greater connectivity via satellites, higher demand for positioning and navigation services on mobile phones, and increased demand for insights powered by artificial intelligence (AI) and machine learning.

The firm anticipates 27,000 active satellites in orbit by 2030, equal to 4000-5000 satellites launched per year.

At the New Zealand Infrastructure Investment Summit in March, the Government pitched a range of space and advanced aviation activities that benefit from natural advantages.

As of September 2024, 124 payloads had been approved for launch from this country, the majority for commercial purposes.

New Zealand is the ideal base for high-altitude aerospace innovation, research and deployment, because of its uncluttered launch windows, unique location, and efficient and supportive regulatory processes.

New Zealand is home to Rocket Lab’s first launch site on the Mahia Peninsula, supporting rocket launches and satellite deployments with critical access to low Earth (LEO) and sun-synchronous (SSO) orbits.

New Zealand has a range of infrastructure supporting both aerial and space operations, including the Tāwhaki National Aerospace Centre and Space Operations New Zealand, respectively.

New Zealand hosts key ground-based facilities, including the Warkworth Satellite Earth Station and the Awarua Satellite Ground Station near Invercargill. These sites support space communications, telemetry and satellite tracking for scientific and commercial missions.

NZ Space and Advanced Aviation Strategy 2024 to 2030

Establishes a world-leading regulatory environment for space and advanced aviation to:

● develop a new Civil Aviation Rule for experimental or developmental aircraft and systems operations to allow rapid iteration and testing of advanced aviation vehicles and technologies

● explore the provision of external regulatory advice to support efficient regulatory decision-making by the New Zealand Space Agency and the Civil Aviation Authority for space and advanced aviation activities respectively

● amend the Outer Space and High-altitude Activities Act to improve the effectiveness of space and high-altitude regulation, and future-proof the regulatory regime to ensure it continues to safely and securely enable innovation and protect New Zealand’s interests.

But New Zealand’s space industry has also attracted unwanted attention, prompting the Government to introduce new laws to deter foreign interference and protect national interests and national security.

New rules will be in place for operators of ground-based space infrastructure (GBSI) by July, Collins says: “During the past five years there have been several deceptive efforts by foreign actors to establish and/or use GBSI in New Zealand to harm our national security. They have deliberately disguised their affiliations to foreign militaries and misrepresented their intentions.”

“It will be an offence to ignore the requirements of the regulatory regime, and could lead to the seizure of equipment, a $50,000 fine and/or up to one year in jail for an individual, and a fine up to $250,000 for an entity.”

The Ministry of Business, Innovation and Employment (MBIE) will act as the regulator of the regime, with the Minister for Space as the decision-maker.