Chinese Snags Launch Contract with a Eutelsat Now Free of U.S. ITAR Restrictions

Why China Will Launch More of the World’s Satellites

News this week that China has secured its first launch contract with a major Western satellite operator in more than a decade comes as a major boost for Beijing, which wants a bigger chunk of the world’s bustling satellite launch business. Paris-based communications satellite operator Eutelsat would not comment on a Feb. 23 Wall Street Journal report that the company had finalized a deal to launch a satellite aboard a Chinese Long March rocket sometime in 2010. If true, the launch will mark a major leap forward for China’s space program.

The U.S. has tightened its regulations on the exports of arms, defense technologies, and even on technologies that can be adapted to military ends. That prevents American companies from using China’s launch capabilities. The regulations even apply to U.S. trading partners that build satellites with U.S.-made components. Beijing has therefore had to do with launches for smaller companies from Asia, Africa, and South America.

The reported new deal is possible because several European aerospace groups, including French firm Thales, which builds satellites for Eutelsat, can now assemble satellites free of American components. Doing so allows operators to sidestep the U.S. rules and deal with China. “The restrictions have placed China outside the commercial launch sector dominated by American, European, and Russian companies — meaning China has to offer services at far lower prices if it wants to become a major player,” says Jeff Foust, senior analyst at U.S. technology and telecommunications consulting firm Futron. “China has that ambition, and doing more business with companies wanting to put satellites without U.S. components in space is one way towards that.”

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