EU to add extra 2.4 billion Euros for Galileo

EU to add extra 2.4 billion Euros for Galileo

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Germany, 06 June 2007: EU Government is expected to agree at a meeting in Luxembourg on June 07 to stop negotiations with the consortium of eight companies which is supposed to invest for two-thirds of the in the Galileo project. It is likely that all of the financing would come from public sources (taxpayers’ money) for Galileo GNSS, as per the official sources.

According to the Ministry consideration, funding the project entirely with public money would require EU to add additional 2.4 billion Euros (USD 3.2 billion) over the 2007-2013 period on top of one billion already reserved for Galileo. In order to cope up for the extra money the European Commission is promoting the idea of using unspent money in the EU’s joint budget and which is usually given back to member states in the form of credits.

Under the original plan, public money was supposed to pay for the first four satellites and then the private consortium companies building the satellites was then to pay for two-thirds of the 26 remaining satellites. The companies AENA, Alcatel, EADS, Finmeccanica, Hispasat, Inmarsat, TeleOp and Thales were to cover their investment costs by also operating the satellites and collecting the fees once they were in operation.

The successive deadlines were missed as the companies argued over their share for the project. As a result, the European Commission recommended the the whole project will be financed with public money. It is said that the companies are increasingly worried that future fees may not cover their investments.