Brussels, 29/11/2001 (Agence Europe) - The European Commission has threatened to give up the Galileo project if no agreement is reached at the Transport Council on 7 December on the launching of the development phase of the European satellite positioning system. During the meeting, on Wednesday, of the Permanent Representatives of Member States, which confirmed the United Kingdom and Netherlands' reticence to the project, Commissioner Loyola de Palacio announced that she could not agree to any postponement of the project and that she "reserves the right to give up the project and to reallocate the funding allocated to Galileo to other projects".
The Transport Council is expected to take a qualified majority stance on the creation of the joint company that will be entrusted with managing the project on behalf of the Commission and the European Space Agency (ESA), as well as on deblocking of the Community contribution for the development phase of the project, with the Commission. Germany seems to be slowly rallying to this. Denmark and Austria are still reticent but, above all, the Netherlands and the United Kingdom are putting the brakes full on. According to the British and the Dutch, the project is not sufficiently mature and the results of the survey carried out by Price Waterhouse Coopers, published last week by the Commission (see EUROPE of 22 November, p.13) do not sufficiently show the long-term commercial viability of the project. One British diplomat states that the United Kingdom supported the Galileo project that comprises an important strategic potential for companies, but it is essential for it to move forward on a sound economic base and for the decision by the ministers to be founded on real knowledge of the advantages, of the management and of the involvement of the private sector. The United Kingdom considers that there is the risk that, at the end of the day, the project could be financed by public money, which is not the line that the Council has always adopted.
The Commission considers for its part that it has respondeds to all the specific Council requests, by publishing the Price Waterhouse Coopers survey, and by earlier giving details on the signals and frequencies emitted by Galileo, the security and the integration of Galileo in the current Egnos system. At this stage, it is no longer an economic, legal or technical issue but a question of political determination, stressed Director General for Transport at the Commission François Lamoureux during a meeting. He noted that there is a qualified majority within the Council in favour of launching the project.
We recall that the total sum of EUR 1.1 billion is foreseen for the development phase of Galileo, of which 550 is to be borne by the European Space Agency and 550 by the Community budget. The ESA confirmed its commitment during its last ministerial council in Edinburg (see EUROPE of 15 November, p.8). The Transport Council, for its part, had released in April a first tranche of 100 million, calling on the Commission to carry out a profitability study on the project, before committing the remaining EUR 450 million. Last week, the Commission published a Price Waterhouse Coopers survey showing that the project's financial profitability is not guaranteed but that its economic viability would be around EUR 17.7 billion for 2008/2020.
In addition, François Lamoureux assured MEPs last week that the United States, whose GPs system will be rivalled by Galileo, are increasingly in favour of the project since the attacks on 11 September. In a message forwarded by the US Embassies in Europe, Washington nonetheless informs Member States that its concerns about the project remain unchanged. One diplomat from the intergroup for consultation with the EU by the US State Department in Washington stated that the US position is that, if the EU continues with the project, they will be ready to work together to ensure that Galileo is compatible with the American GPs system, but that, for now, there is no agreement on the terms and conditions of such cooperation. In particular, he said, they hope to receive assurance that the EU is not discriminatory towards the GPS service providers, providers of material or users. The United States hopes, also, to ensure that Galileo is in place for civilian purposes only, but there is no exact information on this question, said the diplomat. To put it clearly, Washington fears that the signals emitted by Galileo will create interference with those used by the military within NATO.