Rapid growth of commercial Chinese space sector a threat, report warns

Financial Times Europe30 Jul 2026DEMETRI SEVASTOPULO EVA XIAO

China’s com mer cial space industry has grown enorm ously since being opened toprivate invest ment in 2014, said the think-tank’s report, with the num ber of com -pan ies engaged in space activ it ies, such as launch ser vices and satel lite com mu nic a -tions, rising from a few dozen to 600.

Aerospace man u fac tur ing cit ies are being built across the coun try and the num berof loc a tions and facil it ies to launch rock ets car ry ing satel lites is also increas ing. Atleast 10 start-ups have emerged as com pet it ors to the state-run Long March rock etsthat pre vi ously had a mono poly on car ry ing Chinese satel lites into space.

While many of the com pan ies in the report are ostens ibly com mer cial, many workclosely with the Chinese state and are help ing to cre ate space eco sys tems that bene -fit the People’s Lib er a tion Army.

“The US focuses on PLA space threats and lunar plans. We’re not pay ing atten tion toChina’s com mer cial space devel op ments, which are mov ing at a stun ning speed andscale,” said Kari Bin gen, a former Pentagon offi cial who led the report.

Accord ing to the research, two com pan ies — Guow ang and Thou sand Sails — areeach plan ning to deploy more than 10,000 satel lites in space, put ting them in dir ectcom pet i tion with SpaceX’s Starlink con stel la tion. This comes as China is push ing tobuild lower Earth orbit broad band net works with dual civil ian and mil it ary applic -a tions.

The coun try is also cre at ing huge auto mated “giga factor ies” to build satel lites andhas an estim ated capa city for the pro duc tion of 4,100 to 5,000 satel lites a year, com -pared with an annual rate of 500 three years ago.

“Beijing is cul tiv at ing a robust com mer cial space eco sys tem, seed ing star tups,attract ing investors and indus tri al ising at scale, which will bene fit both its eco nomyand mil it ary,” Bin gen said.

The report said China was employ ing the indus trial play book it used to becomedom in ant in other indus tries such as elec tric vehicles, using cent ral dir ect ives, localcom pet i tion, indus trial sub sidies and select ive mar ket lib er al isa tion to pro moteinnov a tion and boost its global mar ket share.“The stakes extend bey ond rock ets and satel lites,” the report said. “Com mer cialspace sys tems are increas ingly becom ing part of the infra struc ture that under pinsglobal com mu nic a tions, inform a tion access, eco nomic activ ity and national power.Coun tries that shape that eco sys tem will shape the broader global stra tegic envir on -ment.”

The FT pre vi ously repor ted that Chinese satel lite groups had helped Iran tar get USmil it ary assets in the Middle East dur ing the Iran con flict and given imagery to theIran-backed Houthi rebels in Yemen.

CSIS said Chinese com pan ies were incor por at ing space ser vices into China’s Beltand Road Ini ti at ive, cre at ing a new “Space Silk Road