THE Ministry of Science, Technology and Innovation (Mosti) has called for finance and investment bodies to open their doors to funding the space industry in Malaysia.
Deputy Science, Technology and Innovation Minister Arthur Joseph Kurup said the call was made due to limited government financing for the sector as of now, and other funding mechanisms such as venture capital, public-private partnerships, competitive financing instruments, and crowdfunding would all be helpful in realising the nation’s space aspirations.
“These financial mechanisms can be used to catalyse the local space industry. In 2021 alone, records have shown that the public and private markets put US$10 billion (RM45.9 billion) of fresh capital to work in space companies.
“The growing interest to pursue spin-offs, partnerships, and private-investment rounds are what fuel the interest of the public and private market to fund these companies’ product road map, thus accelerating innovation and providing more competition among companies,” he said in his keynote address at the Langkawi International Space Forum 2023 at the Mahsuri International Exhibition Centre today.
The forum is in conjunction with the Langkawi International Maritime and Aerospace Exhibition 2023.
Arthur said reports have shown that the global space economy recorded tremendous growth of approximately US$447 billion, up from US$280 billion in 2010, and is expected to grow to US$1 trillion by 2030.
“Therefore, it is time for finance and investment bodies to consider space as the country’s new economic source. Financial innovation is a must for the space industry.
“New funding mechanisms such as competitive grants, debt financing, risk-sharing mechanisms, and tax incentives can attract local and foreign players to contribute or establish businesses here,” he said.
Commenting on the Space Industry Strategic Plan 2030 launched yesterday, Arthur said the plan has outlined a few initiatives to be implemented with the goal to create a sustainable funding and investment ecosystem to promote space commercialisation.
He also urged insurance and lawmakers to catch up with developments to ensure the new era of space innovation reached its full potential while stressing the need to have a legal and regulatory framework on the governance of space for political and defence reasons.
“The legal framework will also make investors and financial institutions comfortable with lending and get insurers comfortable insuring. It will help to reduce risk in participation.
“The recently enacted Malaysian Space Board Act, meanwhile, is aimed at establishing regulatory guidelines for conducting space-related activities in the country,” he said. – Bernama, May 25, 2023.