economy out of this world

These days digital markets are presented with great economic potential. We constantly hear about how strategies are designed to serve the consumer through digital services. Furthermore, much of the economic research of recent years has been devoted to studying these markets.

However, the economy is expanding beyond traditional and digital markets; one would say that even beyond this world. According to the OECD [en Handbook on measuring the space economy], the space economy contemplates all the activities and the use of resources that create and provide value, that benefit human beings during the exploration, understanding, management and use of space. With what are considered products and services ranging from research and development, manufacturing and space infrastructure, as well as scientific knowledge. That is to say, not only the activities that are actually carried out outside the Earth’s atmosphere are considered, but all those that support their realization, use these as an input and even those that are recipients of technology transfers.

There are different economic evaluations of the value of this market made by government and private institutions in many countries. Probably the most significant is the one carried out by the Bureau of Economic Analysis (BEA). According to their estimates, in 2019 the GDP generated by the space economy in the United States was 125.9 billion dollars [Updated and Revised Estimates of the U.S. Space Economy, 2012–2019].

Currently, Mexico does not have a space economy record. However, following the industries that both the OECD and the BEA incorporate, aerospace and electronics manufacturing can be considered as relevant options. The first, in 2021, reached a GDP of 16 thousand million pesos and until the middle of 2022 19 thousand million pesos. The second had in 2021 a GDP of 246 thousand million pesos in 2021 and in the middle of this year it is already 277 thousand million pesos. One way to assess the potential of these industries is to look at international demand. The United States imported 42.6 billion dollars in 2021 and 29.7 billion dollars until August of this year in the first case. In the second, exports reached 70.8 billion dollars also in 2021, 15.2% of the 464.9 billion dollars that this country imported. Mexico only has a participation of between 4% and 5% in aeronautical imports.

However, it must be recognized that both industries depend heavily on FDI, since Mexico itself does not have the technological development, nor the capital for the development of these manufactures. In the first case, 249.7 million dollars were invested in this subsector in 2020 and 305.8 million dollars in 2021. In the second, FDI was 803 million dollars in 2020 and in 2021 it reached 1,072 million dollars according to the Ministry of Economy.

Another alternative way to promote this industry is through scientific research. A couple of examples are the case of the American astronaut, but of Mexican origin, José Hernández; or the scientific work carried out by Dr. Oscar Rodríguez, current researcher at UNAM, who has developed techniques on the polarization of electromagnetic waves that are used to characterize the properties of materials [Monostatic measurement of the polarized bidirectional reflection distribution function], something similar to what rovers do to recognize surfaces on bodies in outer space. Of course there are many other works that due to lack of space are not cited here. Human capital may be the best way for Mexico to join the space economy.

Samuel Vázquez Herrera, chief economist at BBVA Mexico