The Space Economy: Humanity's New Frontier, US-China Competition, the Space Debris Challenge, and Hong Kong's Opportunities
- Dr Frederick Wong
- Jun 5
- 5 min read
What is the Space Economy and Why is it Important?
The space economy refers to commercial activities related to space, including rocket launches, satellite communications (such as Starlink and the Qianfan Constellation), Earth observation, space tourism, AI computing, and resource extraction. Between 2025 and 2026, the global space economy exceeded $470 billion in scale, with commercial activities accounting for nearly 80%. Experts predict that by 2035, it could grow to over $1.8 trillion, with an annual growth rate of 7-9%.
The benefits it brings are highly practical: enabling people in remote areas to access high-speed internet, helping farmers with precision agriculture, monitoring typhoons and earthquakes, researching climate change, and creating high-tech employment opportunities. Space is no longer just science fiction; it is a new engine for driving economic growth and improving lives.
The United States: Leading in Commercial Innovation, Represented by SpaceX
The United States has long been a leader in the space economy, relying primarily on the innovative spirit of private enterprises. SpaceX (founded by Elon Musk in 2002) is the most successful example:
Its goal is to "make humanity a multiplanetary species," and it has invented reusable rockets, drastically reducing launch costs.
Starlink Satellite Network: It has deployed over 10,000 low Earth orbit (LEO) satellites (at an altitude of about 550 kilometers), with over 10 million users across more than 160 countries, providing low-latency, high-speed internet.
In June 2026, SpaceX announced its IPO with a target valuation of $1.75 to $2 trillion, approaching the scale of Amazon, making it one of the largest IPOs in recent years.
SpaceX's success proves that commercial models can drive space development faster and more cost-effectively.
China: Driven by National Strategy, Catching Up Rapidly
China views the space economy as a crucial national strategy, aiming to become a major space power by 2045. The government provides substantial funding, policy support, and resources for "commercial aerospace."
Qianfan Constellation (G60 Starlink): China's version of Starlink, which plans to deploy over 15,000 satellites. Currently, about 180 have been launched, and the pace is accelerating, with a target of initial global coverage by 2027.
It emphasizes national security, connectivity for remote areas, and international cooperation through the "Belt and Road" initiative.
China's advantage lies in its comprehensive supply chain and scale manufacturing. Although it currently lags behind Starlink in scale and maturity, its catch-up speed is remarkably fast.
US-China Competition and Complementarity in the Space Economy
Competition: The two countries are vying for orbital slots, spectrum resources, and the global market. The US leads through technological innovation, while China is catching up using state power and speed. This competition involves economics, security, and international influence.
Complementarity: Competition can accelerate technological progress (such as phased array antennas and inter-satellite laser communications), ultimately benefiting the whole world with cheaper internet and better Earth monitoring. There is still room for cooperation in areas like climate monitoring and disaster relief. Overall, competition and complementarity can accelerate the growth of the space economy.
The Space Debris Problem: A Common Challenge
With the rapid surge in satellite numbers, space debris has become a severe problem. There are currently over 15,000 active LEO satellites, with megaconstellations like Starlink and Qianfan contributing a large percentage. It is estimated that by 2030, these constellations could account for approximately 42% of the pollution risk in the space environment.
Risks: Collisions involving old satellites could generate more fragments, creating a "chain reaction" (the Kessler Syndrome) that threatens other satellites and spacecraft.
Current Measures: Companies like SpaceX actively deorbit their satellites to burn up in the atmosphere at the end of their lifespans; there are also international guidelines for debris mitigation.
Future Needs: Stricter international rules, better tracking technologies, and sustainable designs are required; otherwise, space will become increasingly crowded and dangerous. This is a common challenge facing the US, China, and the world, requiring collaborative solutions.
The Impact of SpaceX's IPO on the World's Future
SpaceX's successful IPO is not just a single company going public; it is a landmark event signifying the space economy's entry into mainstream financial markets:
Capital Injection: It attracts more funds from institutional investors and the general public into the space industry, driving further innovation and entrepreneurship.
Demonstration Effect: Much like the "Netscape moment," it shifts space from being government-led to a commercial mainstream, accelerating the development of satellite internet, space infrastructure, and AI applications.
Global Impact: It lowers launch costs and expands global connectivity (especially in developing countries) while stimulating employment and technological advancement. However, it also brings challenges, such as high valuation risks, Musk's personal influence, and regulatory needs.
Long-term: It may accelerate human multiplanetary exploration and alter the landscapes of communications, data, and economics, turning the space economy into a true trillion-dollar industry.
Hong Kong's Contribution and Legal Foundation in the Space Economy
Although Hong Kong does not have a launch site, it can play the role of a "super-connector":
Finance and Professional Services: Attracting space companies to list in Hong Kong, providing financing, risk management, and insurance.
Innovation and Technology (I&T) Contribution: Universities participating in satellite data analysis, AI applications, and aerospace research to support national missions.
Sustainable Contribution: Developing space debris management and green tech, while connecting the mainland with international markets to support the "Belt and Road" initiative.
What is Hong Kong's Legal Foundation?
Hong Kong can develop under the Outer Space Ordinance (Cap. 523), which regulates activities such as launching and operating satellites, with licensing overseen by the Communications Authority. It requires compliance with international space laws (such as the Outer Space Treaty) and includes debris mitigation guidelines. The Hong Kong government has actively optimized listing rules in recent years, promoted aerospace companies to list in Hong Kong, and plans to strengthen regulations related to civil aviation and LEO satellites.
Overall, Hong Kong's common law system, intellectual property protection, and international arbitration capabilities are robust, providing a stable legal environment. However, facing the rapid development of commercial space, it still needs to continuously update guidelines, strengthen specialized talent training, and enhance international cooperation to maintain its competitiveness. Hong Kong is working towards becoming a "Space Law and Arbitration Center"—it has a solid foundation but still has room for optimization.
Future Outlook
The space economy is transitioning from a government-led model to a mixed commercial and national model. US-China competition is accelerating innovation, while challenges like space debris are testing global cooperation. SpaceX's IPO injects new momentum into the world, and Hong Kong, with its unique advantages, can make significant contributions in finance, law, and I&T.
For the general public, this means better internet, safer lives, and more high-quality job opportunities. Paying attention to the space economy means paying attention to the shared future of ourselves and the next generation.
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