NILS FLAATTEN: Lost in bureaucratic space — SA’s satellite opportunity

As South Africans admire Elon Musk’s Starlink satellites brightening the night sky, few recognise the monumental shift he has spearheaded in space economics.

Musk’s tenacious efforts to advance SpaceX rockets have drastically lowered satellite launch costs, democratising access to space and enabling a wide range of nations and businesses to enter low-earth orbit (LEO).

This surge in satellite launches has transformed the space economy, a sector once dominated by governments and military organisations, into an arena of commercial and technological opportunity.

LEO satellites, which orbit between 200km and 2,000km above the earth every 90-120 minutes, are essential for earth observation, communication and research. But building, launching and maintaining these satellites demand sophisticated aerospace, electronic and mechanical engineering. Key to the global satellite supply chain is establishing “legacy”, which refers to components with a proven track record in orbit — a critical marker of reliability in space systems.

SA is well positioned to carve out a niche in this rapidly expanding market. High-value manufacturing in the satellite industry offers economic opportunities for countries able to demonstrate the technical capability to produce space-hardened systems. The global small satellite market is projected to grow from $5.2bn today to $11.2bn by 2029, which translates to an increase of 1,442 new small satellite launches in the next five years. Yet, despite the projected growth of the global space economy, SA remains hamstrung by bureaucratic inertia and underinvestment in its space infrastructure.

The country’s first foray into space came in the late 1990s when the University of Stellenbosch developed SA’s first earth observation satellite. Since then the nation has launched seven satellites, including EOS-SAT1 in 2023. The global trend is shifting towards smaller, cheaper nanosatellites (1kg-10kg) and CubeSats (about 2kg), whose compact sizes are matched by the growing sophistication of their optical and communication payloads.

Central to SA’s satellite ambitions is the Houwteq facility, located in the Western Cape near Grabouw. Once a top-secret military installation, Houwteq now operates in a state of neglect, kept alive by a handful of committed staff. The facility is equipped with valuable resources such as “clean rooms”, vibration and acoustic chambers for rocket tests, and extreme cold rooms that simulate the harsh conditions of space. However, under-use and lack of funding have left much of this infrastructure languishing.

Only 130km away lies the Denel Overberg test range, a sophisticated testing site for rockets and missiles. The test range’s radar, optical tracking and telemetry systems make it an ideal location for high-altitude and long-range testing. The geographic proximity of Houwteq and the Overberg test range presents a golden opportunity for SA to combine satellite development at Houwteq with testing and launch capabilities at the range and help to establish the country as a significant player in the space economy.

However, Houwteq is trapped in a bureaucratic stalemate. It sits between the under-resourced SA National Space Agency and Denel, a state-owned defence contractor crippled by financial challenges. Neither organisation has the means or vision to revitalise the facility. Yet, with the right investment, Houwteq could evolve into the hub of a new space cluster, forming the backbone of an SA space economy.

This vision extends beyond mere facility upgrades. The goal should be to transform Houwteq into a Space Economic Zone (SEZ), consolidating all space-related activities — research, manufacturing, testing and satellite operations — under one co-ordinated initiative. A fully operational SEZ would not only create jobs but also attract investment from domestic and international space companies. By leveraging existing infrastructure, the SEZ could host satellite launches, conduct rocket tests and become a centre for space technology innovation.

A crucial area of focus for this space cluster should be SA’s advancement into S-band frequencies, allowing for greater data downloads and improved communication capabilities. While the country has a strong legacy with UHF and VHF communication systems, expanding into the higher-frequency spectrum would make the country more competitive in the global satellite market. Additionally, tapping into emerging technologies such as artificial intelligence (AI) would enable the cluster to optimise satellite health monitoring and predictive maintenance, further strengthening SA’s technological edge.

Another unique capability SA could further develop within the space cluster is space weather monitoring, which involves tracking solar activity and other phenomena that affect satellite health and global communications. This expertise could be expanded, linking Houwteq with national institutions such as the Hermanus Magnetic Observatory and the SA Radio Astronomy Observatory’s Hartebeesthoek facility.

SA’s space ambitions should also be aligned with the objectives of the just energy transition. Integrating earth observation satellite data into climate change initiatives could attract international funding, particularly for monitoring emissions, greenhouse gases and extreme weather events. Satellites could also aid in protecting maritime and land-based resources, offering critical data to improve urban development and sustainability.

To make this vision a reality the government must address the bureaucratic bottlenecks that are stifling progress. A space cluster focused on manufacturing, space weather, AI-driven health analysis of satellite systems and legal frameworks could galvanise SA’s space economy. By attracting start-ups and fostering public-private partnerships, Houwteq could become a launch pad for local innovation and international contracts.

With the right strategic investments and visionary leadership SA’s space cluster could evolve into a world-class SEZ, positioning the country to play a role in the $1.8-trillion global space economy. Imagine a future in which SA-made satellites soar alongside Musk’s Starlink fleet, contributing to cutting-edge technology and innovation.

However, without urgent action to cut through the bureaucracy, SA risks being left behind, missing out on its chance to capitalise on the opportunities lighting up the skies above us.

• Flaatten is a corporate strategist focused on investment promotion and sector development.