2 Introduction

The end of confrontation in space, driven by the Cold War, inevitably diminished governmental commitments to impressive space projects and led to tighter space budgets. The new environment made an international cooperation in space not just a logical way of promoting global human development, but also a potentially resourse-saving approach to solution of up-to-date tasks.

However, a transitional way from confrontation to cooperation appeared blocked by significant problems, which sometimes raise doubts, whether that is really a way towards tomorrow. The purpose of this paper is to address these problems in order to make them clearer and easier to resolve. The paper begins with discussion of current situations and concerns of various space powers. Those conems are analysed to reveal the general fundamental problems behind them. Ways of dealing with that fundamental problems are later discussed, as well as observed advancements along those ways.

2 Background

A methodological complexity of the task is determined by the fact, that a pattern of interactions to be analysed got drastically complicated after the end of the Cold War. Previously, a main contradiction developed between the Eastern and the Western blocks. It was this main contradiction, which can be focused on, while neglecting internal peculiarities of blocks. With respect to space this principal conflict was sen primarily in confrontation, or a space race, between the United States and the Soviet Union.

Nowadays the Eastern and the Western blocks, which earlier could be considered as monolithic, revealed their internal structure and conflicts between their constituent elements can no longer be ignored. Moreover, an international space arena now features additional participants, which earlier could not be taken into consideration. Those are China, India, Israel and, in a perspective, a number of states from South-East Asia. (We will not further discuss this issue, just note, that it will have increasing importance in a future.)

Nevertheless, fundamental problems of relationships between space powers get their reflection at all the levels, including various levels:

• general East-West interactions (inter-block relations);

• inter-state relations, either inter-block (i.e. that of between an Eastern and a Western state) or in-block (between two countries within a block);

• in-country interactions (between different forces within a single state).

Let us consider internal situations in different space powers and basic disagreements between them. A primary emphasis will be given to relationships, involving countries of the former Soviet Union, as the most controversial and less clear.

2 Space Powers Problems and Concerns

East (Former Soviet Union)

Russia is a principal successor of a space program of the FSU. As such, it carries a burden of sustaining scientific and technological capabilities and infrastructure, which before long employed about 800 thousand people in rocket and space sector and performed up to one hundred space launches per year. Russia also got a burden of prestige of the great space power, one of the top two in the world. A self-rating of the national space program by majority of people, associated with it, is in the best terms described by "Number 1.5", rather than second to the American.¹

Understandably, Russia has major difficulties in keeping technological capabilities and space-related infrastructure of the former Soviet Union. A workforce in space-related industry squeezed down to 560 thousand in 1993. A level of funding is even hard to estimate at all with the inflation of 10 to 30 per cent a month throughout 1992 -1993 and funding apporiations taking place on an occassional basis, rather than through a steady process. For example, during the first half of 1994 the Russian Space Agency got only 10 per cent of its annual request.²

A notion of "international cooperation" has a diverse meaning for Russia. First, there are two different basic arenas for international activity - one is the FSU or a "near abroad", and another is a "far abroad", i.e. the West and the Third World countries. Moreover, "cooperation" has at least two aspects for each of the two arenas.

One aspect of an inter-FSU cooperation is a sustainance of a production cooperation, established under the USSR. Historically, final space products were assembled mainly in Russia, with cooperative ties spread across the Soviet Union. After Russia accepted a full responsibility for continuation of space program of the former Soviet Union, it got a constant pain of sustaining a production cooperation to keep the program running.

Another aspect of an inter-FSU cooperation is what was supposed to be a joint use of results from space activity, both in terms of scientific research and space applications. That shared use of benefits from space activity had to come along with joint funding of it.

However, Russia does not see appropriate commitment from other members of the Commonwealth of Independent States to invest into space program. Hence, Russia believes, that other republics of the FSU are unwilling to carry a fair proportional share of space programs burden. (This applies not only to space program. As during the Soviet Union, Russia remains a donor for most of other republics, with up to 8 per cent of Russia's GNP donated to them.³)

Along with a general reluctance to sustain other republics at Russian expense, specific concerns may occasionally arise about business unreliability of contacts with some FSU states. Those are fuelled by permanent policy-driven tensions between various republics, with Russian-Ukrainian and Russian-Kazakh relations being of especial importance for this consideration. Kazakhstan draws a severe criticism for its "exorbitant demands" for leasing the Baikonur Cosmodrome out to Russia. Those demands are considered as little but desire to raise Kazakhstan's national well-being at Russia's expense.

As a result of these tensions and perceived uncertainty about long term relationships, there is a strong trend in Russia to develop a self-sustainance in space activity, especially in defense-related programs.

A cooperation with Western countries got a powerful stymulus with a sharp cut of internal financing during the last year of the USSR and immediately after its demise (in 1991-1992).

An international cooperation was then considered as the way of salvation of national scientific and technological capabilities. It was then, when the industry and the science rushed to all kinds of cooperative ties with foreigners. Noteworthy, in that movement Russia did not draw a clear distinction between non-commercial joint international projects, like space science missions, and commercial space market operations, like launch services. That mix-up of a non-commercial cooperation and a competition for a share in a global market had an objective reason. By the time, when that rush to an international arena started, Russia can not perform on her own even space science missions, and it had to break an established principle of international cooperative projects, a principle of no-fund-exchange.

That principle had to be stepped out from first to maintain operations of the Granat astrophysics observatory beyond a designed lifetime and later to prepare the Mars'94 mission.

Having scored just a little success in attempts to join global space market and sometimes having faced an open opposition from the U.S. and other Western powers to those attempts, a significant part of Russian space industry and policy-makers considered the Western opposition as a coherent policy to destroy the former Cold War adversary, using a "cooperation" just as a new cover.

To complete a Russian picture it is necessary to note, that within the national space program there are some tensions and discrepancies between the Russian Space Agency (RSA), which supervises a civil space program and the Space Forces of Russia (SFR), responsible for all space launches and spacecraft control.

As a military Force, which bears primary responsibility for military space systems operations, the SFR favours a self-reliance in the space program. It claims necessity of assured access of Russia to space, which, as stated, can not hinge on relationship with another state, not even friendly and a member of the CIS. Hence, the SFR presses for development of new launch facilities in Russia instead of the Kazakhstan-based Baikonur.

As to an international and commercial activity, the SFR also has claims against the RSA, which, allegedly, uses servicemen to do all dirty job and does not even pay properly, not to say about investing into the SFR's overworn infrastructure.

The RSA does not has its own infrastructure, historically operated by the Space Force. Under current stiff conditions it can neither establish a new infrastructure, nor even maintain appropriate segments, if transferred from the SFR, as recently decided.

The RSA is more abound to an international coperation by virtue of its mission, which gives it a responsibility for both representing Russia in international cooperative projects, and for licensing Russian companies for commercial space services operations, including those, provided to foreign customers. The latter is seen by the RSA as an important way of self-support for a national space industry. Yuri Koptev, the General Director of the RSA, estimated that "participation in international space projects could provide Russia annual income of 200-220 million dollars".⁴

Ukraine has a second rating in terms of rocket and space potential among republics of the former Soviet Union. Accordingly, Ukraine also has grave concerns about keeping unique scientific and technological capability as well as many tens thousands of space-related jobs.^*

In addition to troubles Russia has in this respect, Ukraine also experiences a special problem. As its space production is oriented to a Russian consumer, Russia's claims about self-reliance are considered as an intention to kill the Ukrainian space industry. Moreover, Russia is accused of making unfair profits from Ukrainian hardware, which is purchased for rubles and used in missions, for which Russia gets hard currency. Russia and the West together are also accused of preventing Ukraine from entering a global space market.

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* No exact figures are known to the author, but estimated employment in rocket and space industry in Ukraine is between 60 and 80 thousand people.

Kazakhstan has a special place in the FSU with respect to the space program heritage. It does not possess a substantial space-related industry, but hosts a key element of space infrastructure, the Baikonur Cosmodrome, which is the sole site for all manned and interplanetary missions as well as for launches of geostationary satellites and heavy reconnaissance spacecraft. Kazakhstan is interested in getting maximum payback from the space infrastructure, which it can not use on its own anyway.

In lengthy and, as of this writing, yet to be completed debates over Baikonur Kazakhstan first rejected Russian proposals to make Baikonur a Russian military base on grounds of a national sovereignty. Later it set reimbursement requirements, which Russia can not accept. Original claims went as far as $3 billions a year. Those seemed to be negotiated down to $115 millions when the agreement was signed by Presidents Yeltsin and Nazarbayev on 28 March, 1994. However, soon after that it was claimed, that $115 millions due each month, rather than a year. Later was admitted, that $115 million is an annual payment, but it was claimed to be just a start-up amount for leasing just space, of the test range, with extras due for ecological damage, etc., etc.⁵

Kazakhstan's utmost desire - to see Baikonur demilitarized and converted into International Spaceport to perform commercial launches - again demonstrates interrelation of international cooperation and space commerce in views of ex-Soviet states.

West

United States, the leading space power, faces space budget cuts, and appropriate challenge of keeping a skilled workforce, space-related infrastructure, and ensuring competiveness of an American space technology at a global market.

In 1993 aerospace industry^* employment in the U.S. reduced by 13% to 909 thousand and 1994 is expected to bring additional 5.4% reduction.⁶ The National Aeronautics and Space Administration instead of 10% increase of its annual budget is now going to face flat funding until the end of a decade (equivalent to estimated 4% loss in real terms)

With respect to the task of ensuring a global competiveness of the American space technology, the U.S. had already problem with stiffening competition from Europe, particularly in space launch services and in space imagery sales. Nowadays, American suppliers perceive yet more impressive threat from Russian services.

A Russian intervention into established markets is mostly considered by the U.S. industry as a subversive action. The USSR and later Russia has been accused of an unfair competition and an intentional dumping, based on a subsidized nature of the Soviet economy and intended to destroy the American defense-related industry.

Whenever projects for joint developments with Russia are discussed, concerns are raised about reliability of Russia as a partner and benefits from such an cooperation in terms ofresourse-savings are doubted.

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* Note, that for Western countries employment figures represent cumulative workforce emioyed aviation and in missile and space industry, while in the former Soviet Union - exclusively in rocket and space industry.

Europe also experiences budget pressure for space programs. The European Space Agency got a 10% budget cut for 1994 and have to trim $4 billions from its programs through the rest of a decade.⁷ To meet that, ESA had to freeze Hermes spaceplane and scale back other ambitious man-related projects. In Europe only France was able to keep a significant national space program along with participation in ESA activities. Despite overall French aerospace industry employment lost some 7000 jobs in 1991-1992 from a total of 119 thousand,⁸ the French space agency, CNES was able to keep a slight but increase in budget outlays.

The European space industry, which fought for a long time for a competiveness against the American one, believes, that the American industry enjoys more support from the government, and a competition between Europe and the U.S. is not quite fair.

Europeans are also concerned about a Russian penetration into a global space market. However, their reaction seems less noisy, either because of their less reliance on their governments, or because they are sure that their positions at market niches, already won from the Americans are sound.

Japan has just reached a long-standing goal of a technological independence in its national space program. Today Japan is perhaps in the most favourable condition compared to other space race participants, who took start during the Cold War. Unlike them, Japan has a steady growth of space budget amounted to about 7% a year.⁹

Japan, with its traditions of a stable policy and assured succession, always had difficult times in cooperating with the U.S. and other Western countries, because of typical for the West rapid policy changes.¹⁰

One could only imagine Japanese expectations from pursuing joint projects not only with the Western countries, but also with Russia, policy of which is now famous for unpredictability. No direct comments about that are known to the author. Nor Japanese were heard as complaining about improper treatment at a global market, despite the fact, that their position there is yet far from desired.

2 Problems essence

From the above discussion one can derive, that the first fundamental problem behind all discussed internal problems is an unapproriate structure of the national space programs. Major goals of national space policies as well as associated establishments and infrastructures, developed during the Cold War, do not fit the post-Cold War environment.

During decades of the space race space agencies of major space powers got accustomed to big projects and appropriate funding, to favourable attitude of top leaders. With an inflated staff and reduced flexibility and performance-driven approach they were not prepared for more stiff and competitive environment.

Mechanisms for setting tasks to national space programs also proved far from appropriate because of decades of more or less distorted goal-setting in accordance with the Cold War demands.

This is not to say, that all space-related structures were completely unappropriate. However, it was a presence of an irrational component, which determined severity of a restructuring problem after the Cold War was over. The larger was that irrational component, the greater problems national space program runs into.

The above consideration, demonstrates, that the more efforts country spent to the Cold War-driven space race, the more its space program suffers after the end of the Cold War. The two key players in the space race, the former Soviet Union and the United States, are the principal victims of it.

The second fundamental problem, appearing from above analysis, is the problem of misunderstanding or misinterpretation.

All the time estimates of intentions and moves of one side by another have little if anything to do with original motivations. While an A party never raised a specific task of destroying or subverting а В party as a competitor, it is exactly this, what а В party perceives to be a primary objective for A. Furthermore, A itself suspects В to have a subversion of A as its primary goal, despite A does not set its own priorities that way.

More specifically, Russia never set a goal to destroy the Ukrainian space industry, as well as the United States never claimed destruction of the Russian industry as an aim. Similarly, nobody in Russia not even ever mentioned, that joining the International Space Station project would give Russia a capability to blackmail the United States, as feared by some American politicians.¹¹

This inability or unwillingness to understand viewpoints of each other is also a heritage of the Cold War. This rooted thinking gravely complicates the first fundamental problem.

Except of the two formulated fundamental problems there is one important detail to mention here. It is misleading to present a trasnsformation of global space activity in a post-Cold War era exclusively as a transition from confrontation to cooperation. In reality, the transition occurs from confrontation to competition and cooperation, as there are areas, where competition always remains. A mix-up of these two different aspects additionally complicates already difficult problem of mutual understanding.

2 Basis for Optimism

The above discussion of postures of different states demonstrates, that neither party formulates its primary task as to infringe another. The top priority for anyone is to ensure one's own survival, rather than to destroy an adversary or a competitor.

This minor difference bears a chance for achieving a compromise to assure mutual survival. However, to find and execute that opportunity it is imperative to overcome a contradiction between self-perception by every party of its own problems and actions and their interpretation by other parties.

As said, the Problem #1 in a post-Cold War environment is to restructure space programs and establishments to increase their efficiency and suitability for solution of new tasks.

As long as tasks of global human meaning as concerned, doubts barely appear, that an international cooperation in its traditional understanding holds a great promise for exp'ansion of overall capability to solve those tasks by virtue of unifying the best scientific capabilities, available from various countries.

It is not as commonly accepted, that an international integration of space activities would be a good thing for optimisation of national space-related capabilities.

However, one may argue, that expansion of a basis for competition beyond national borders could eventually promote more optimal development of capabilities, available for solution of national tasks.

Therefore, a general recommendation about the Problem # 1 is to expand and level off an area for international competition in space-related services.

In this respect, political decisions are called for establishing common rules, rather than to create artificial barriers. At the expanded field and with extended pool of capabilities normal economic competition is capable of faster and more effective developments to meet common demands for performance.

No doubts, there are areas of specific national sensitivity in space capabilities, with national security applications being a clear example. However, even they can benefit from expanded international competition in space developments. (An idea of launching national security payloads on foreign launchers, recently recommended for consideration by the U.S. Senate is not as outrageous as it looks from traditional standpoint. Noteworthy, the Russian Space Force now already uses foreign - Ukrainian-made -launchers to deliver national security payloads. To say more, those sensitive payloads are even manufactured in Ukraine!)

The above should not be treated as an appeal just to open doors for Russian or ex-Soviet expansion. This call applies to a reciprocal process as well. Moreover, one can expect even in a near term, that Russia will become a greater consumer of space services than a supplier. The internal Russian demand for space-related services grows and will continue so, while national suppliers are traditionally less flexible and cutomer-oriented, than foreign. The first examples of that kind are already available, with a Russian steel corporation purchased satellite communications equipment from the Japanese NEC corporation, rather than from a national supplier.¹²

Nevertheless, a transitional character of a modem situation and close involvement of its primary participants with key national interests, have to be constantly remembered while suggesting ways to overcome todays problems. Few would accept promises of prosperity somewhere in the future, if a way to those future heights goes through a dip today. An appeal to supreme national interests (no matter, real or imagined) would be an effective tool to negate such proposals. Therefore, one must look for transition ways, as plain as possible and offering some benefits in a short, rather than a long run.

2 How this works in reality?

Some recommendations to fit the above condition has been put forward by the author last year.¹³ A recommended way was to establish direct business relationships between Eastern and Western industries, with particular emphasis to joint ventures, which would enable second tier Western players to increase competiveness up to a top level in their respective country of in the West as a whole. That approach would simultaneously disclaim charges of unfair competition, addressed to the East.

With particular respect to use of space-related capabilities of the FSU the proposal was predated by two important prerequisites to be executed:

• independent republics of the FSU - nembers of the Commonwealth of Independent States - should have restored normal economic relations to ensure succession of the ex-Soviet space capabilities;

• Russia should have completed formation of an appropriate environment, favourable for foreign participation in space activity.

During a year passed, integration trends began to prevail in the CIS. In Russia, a legislation on space activity has been accepted, which declared equal rights of all participants in space activity, both domestic and foreign.¹⁴

Despite all changes in top political pattern, the President and the Government adopted decisions geared to protect and attract foreign investments.^*

As to advances in the prescribed way of business development, new examples appeared, to prove this trend and also to demonstrate its diversification (see table 1). A major push in this direction was provided by the U.S. government plans to stimulate conversion of the former Soviet defense industry by providing a seed money to develop commercial ventures in conjunction with the U.S. companies.¹⁵

Along with now-academic examples of Lockheed -Khrunichev and Pratt & Whitney - Energomash ventures, where American companies picked up Russian lead suppliers of GEO launch vehicles and of large liquid rocket engines, in order to raise up to the level with superior national competitors, there are also cases, where leading U.S. companies approach Russian ones in apparent attempt to diversify their core business.^**

Aerojet Corporation studies a variety of Russian engines, from low-trust electric jets to 150 tons thrust oxygen-kerosene engines originally designed for the N-l moon launcher.¹⁶ Space Systems/Loral, one of leading manufacturers of communications satellites, studies joint projects with NPO Mashinostroyenia, which never designed comsats, but is proficient with missiles and Earth monitoring platforms.

The Russian leader in communications satellites development, NPO PM of Krasnoyarsk-26, has an agreement with a Canadian group, including Spar Aerospace, ComDev, et.al, which can be in effect considered as a "second tier" competitor to American companies.

Similar trend to use Russian capabilities to increase competiveness on the all-Western, rather than just national arena is seen, also in intention of the American EOSAT company to start selling Russian images, which feature the world best commercially available resolution of 2 meters. EOSAT, a Landsat spacecraft operator, is now #2 seller of satellite imagery in the world after European Spot Image.

Unlike early expectations, the Russian involvement was not as substantially used by European countries to increase their cumulative capability to the level comparable to that of the United States. One reason for that was that when new eagerness to cooperation appeared, Russians first turned to the U.S., as to a fellow space superpower. Secondly, and, perhaps, more important, a direct Russian involvement into joint projects apparently proved unequal for Europeans, as it was felt, that Russian capabilities are too extensive and would overwhelm European independent developments.

It was these grounds, on which the study of joint development of Hermes spaceplane was abandoned. It became clear, that Russians already have everything but funding to do the project without Europeans.

Presumably, Europe, particularly France, would be more interested in joint developments with Ukraine. Ukraine also inclines to France. Notably, Ukrainian self-rating of domestic rocket and space capabilities gives her "numbers 3-4 in the world, shared with France."

A first milestone in cooperation between France and Ukraine was seen in signing an agreement between Aerospatiale and Yuzhnoe Association. Eventually, one may envision development of joint light-weight satellite launcher, or, say, the "Ariane-5L" launch vehicle with Zenit rocket blocks as "Ariane-5" strapons.

After this optimistic view of expanding relations between ex-Soviet and Western space industries, it is necessary to warn, that an attitude of the Russian space sector towards contacts with Westerners gradually cools. As predicted, low success of first attempts to sell everything available to the West, as well as poor responsiveness of most Western companies to joint project proposals, from one hand, stimulates more aggressive pursuit of domestic support from the government. From another hand, they heat up suspicions about "true" goals, for which the Russian openness is used by the West.

The latter notion returns us back to an importance of constant watching and mitigating the Problem #2 -that of misunderstanding and misinterpretation of each other.

Remarkable is a fresh example of the Mars'94 controversy, when the.Russian Space Agency unexpectedly stated at'the 44th IAF Congress, that the Mars'94 mission could not be launched on time, unless Russian side quickly received at least $10 millions. That statement, which can be readily used to illustrated a "threat of a Russian blackmail", was in fact, a reflection of a Russian tradition "not to carry garbage out of a house", i.e. try to resilve problems internally, without exposing them to the public.

In a similar twist, two weeks after NASA has been notified in writing, that the Mars'94 launch will not occur in 1994,¹⁷ the AIAA group was told at the RSA, that "we're doing everything possible to make it on time". That was also an inherited institutional custom to release information only on a "need-to-know" basis, rather than an intentional desinformation.

On the other side, the Russian space industry and officials do not quite understand, how such high profile projects, like the Space Station could have so small margin of stability in such a wealthy power, like the United States.

While the problem of restructuring national space industries demands primarily concerted efforts of companies, seeking for enhancement of their competiveness, and of governments, creating environment for that, the resolution of problem of mutual understanding in international relations demands aggressive efforts from non-governmental and non-industrial comers, such as experts, consultants and public interest groups. Independent, non-aligned views are imperative for timely identification of emerging or potential conflicts and preventing build-up of misunderstanding above a critical point.

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* The author would not state, that Russia has a coherent policy. Russian policy is rather a net result of multiple pushes from different comers. As a result, basically simultaneously with decrees about protection and attraction of foreign investments, the central establishment, responsible for their attraction, RAMSIR (Russian Association for International Cooperation and Development) was disbanded and that responsibility was spread across three Other establishments. Nevertheless, the observed course of net movement of Russia even under this conditions of rope-pulling, sends an encouraging message. This environment means also, that a rational strategy is not to wait, until a policy would become coherent, but rather apply extra push to assist movement in a positive direction.

** Diversification of business in order to become less vulnerable to failure in one particular segment of a market is a second principal approach for attaining business stability, as opposed to concentration in a core segment to ensure better competiveness in it.

 

Table 1. Cooperative business activities of Western and ex-Soviet space companies