The Next Frontier: China’s Space Travel Ambitions

It is quasi-axiomatic to state that China is interested in eventually becoming the world’s #1 superpower by employing a wide range of strategies: fostering robust domestic consumption and the transition to a model which enables China to leverage its increasingly prosperous middle class, establishing itself as a soft power that represents a desirable trading partner by oftentimes buying its way toward geopolitical influence (through the Belt and Road Initiative, the AIIB, etc.), stepping in whenever the United States makes a step back (from establishing itself as the main game in town in Africa to achieving progress in the Middle East)… the list could go on and on.

What many market observers either don’t know or under-estimate is the fact that China’s ambitions exceed the boundaries of our planet. In a previous article, we have made it clear that comparing China to the USSR and/or the current geopolitical context to the Cold War period is sub-optimal at best, but that does not mean there are zero common denominators.

The so-called space race represented one of the hallmarks of the Cold War, from Yuri Gagarin who ended up being the first person to venture into outer space to the Apollo 11 mission that enabled a US mission to land on the moon. Needless to say, however, these achievements came at oftentimes tremendous costs, with the peak in terms of public spending on NASA as a percentage of the GDP being the 4.41% achieved back in 1966.

Since then, in the absence of a major propaganda-related incentives system and in light of the fact that the general public had other priorities when it came to capital allocation, the US took major steps back and gradually encouraged the public sector to take over (Jeff Bezos with Blue Origin LLC, Elon Musk with SpaceX and Richard Branson with Virgin Galactic being let’s say the private sector space pioneers at this point in time… with the important caveat that NASA is still the reference point for the time being and private initiatives are still in their relatively early stages), let’s not even talk about the USSR and subsequently Russia after the fall of the Soviet Union, with space exploration not exactly representing a priority.

For today’s China, however, space exploration seems to be more and more attractive.

As those of you who have been following our work here at ChinaFund.com for an extended period of time already know, China loves making long-term plans and the space exploration dimension most definitely doesn’t represent an exception. In fact, the space presence of China represents a key area of interest when it comes to the vision China has for the 1st of October 2049, a date which will mark the 100th year of existence of the People’s Republic of China.

What, specifically, does China have in mind?

To put a more detailed perspective as well as rough timeline on the table:

1. Investing in the infrastructure it takes to be able to effectively launch and manage missions
2. Once that infrastructure is firmly in place, it will be time for China to have its very own permanent space station
3. Moving on to a more let’s say military dimension, what follows naturally is China’s intention of securing (and by that, we mean dominating) the so-called cislunar space, in other words the space between the Earth and Moon
4. Next, we have the goal of (of course) establishing a presence on the Moon and ensuring that a solid enough infrastructure is in place to power its base(s) in a sustainable and even decentralized manner (for example through so-called SBSP or space-based solar power technology)
5. Last but not least, there are of course goals surrounding more meaningful space exploration on the one hand and on the other hand, even turning the space dimension of its strategy into something economically viable through methods such as asteroid mining

While most of these initiatives will probably involve public spending, it is worth noting that private initiatives with respect to space exploration are encouraged in China as well, with noteworthy achievements such as the iSpace company successfully launching a rocket into orbit in mid-2019. Other companies active in the space include LandSpace, OneSpace and LinkSpace. Again, public spending is most definitely the main game in town but private initiatives might also generate unexpected (hopefully positive) achievements.

When it comes to China itself, just a few of its plans and achievements in the space exploration department include:

1. Creating the very-first publicly funded SBSP plant, an investment in the $30 million zone
2. Investing in a future nuclear-powered space vehicle, with 2040 being the current target for an official test. These vehicles will have a commercial role, one related to asteroid mining, as well as roles pertaining to deep space exploration
3. Paving the way for a 2020 Mars probe (Orbiter + Lander) and, ultimately, its first human mission by the year 2036
4. Progress with respect to the rocket dimension, from fine-tuning its Long March 5 rocket (25-ton Low Earth Orbit potential and 14-ton Geostationary Orbit potential) to working on the Long March 9 one (140-ton Low Earth Orbit Potential and 50-ton Lunar Transfer Orbit potential)

The list could continue, but an important observation arises: while meaningful developments have already taken place, most of the information we have provided is future-oriented. As such, it would be a bit of an overstatement to consider China a present-day leader when it comes to space exploration. At this point in time, let’s just say the US (NASA as well as the private companies mentioned in this article… but especially NASA) is still the number one player in this space… pun intended.

Therefore, it makes more sense to consider it an ambitious contender at this point, with it remaining to be seen to which degree its ambitious to the point of overly-ambitions (as tends to be the case with China when it comes to a wide range of other dimensions as well) plans will materialize.