Governments have been told they have a vital role to play in driving the growth of the space economy, but public private partnerships may well be key to delivering in the world’s ambitious targets.

The OECD has issued a new report which highlights the space economy is playing a growing role across critical infrastructure and the wider economy, supported by sustained government investment and rising private capital.

OECD civil space budgets reached an estimated $46.4 billion in 2025, up from $40.5 billion in 2022, with defence demand climbing in parallel, according to a new OECD report.

The Space Economy at a Glance 2026 report found that while space’s direct footprint in GDP is still relatively small, its strategic and economic importance extends far beyond the sector itself. Space-based systems already support more than half of the most critical infrastructures and services across OECD countries, including transport, energy, communications and food supply. In some OECD members, close to one fifth of GDP is supported by satellite-enabled services.

“Governments remain central to steering the development of increasingly competitive commercial space markets,” the OECD added. “The report identifies more than 200 space-related policy initiatives and almost 300 policy instruments across 45 countries, the European Space Agency and the European Union. Governments influence both the pace and direction of market development through public R&D, procurement, commercialisation support, data-access policies, incubators, technology transfer, regulation and finance.”

The number of countries with space-related regulations has increased by 50% over the past decade, nearing 60 by 2025. The OECD added governments should continue to adapt their legal and regulatory frameworks to support commercial space activities, as they are strategic for national space competitiveness and attractiveness. Adapting regulation to a more competitive and commercial space economy is key, while managing safety, liability, security and sustainability risks and maintaining the international co-operation needed to keep orbits safe and usable.

“Our transport systems, energy grids, communications and food supply all depend on the commercial space economy,” said OECD secretary-general Mathias Cormann. “Governments can make the sector more competitive, more attractive for investment and safer through strategic public procurement, smart regulations and targeted support for innovation.”

The report added private investment is also playing a growing role in the space economy. Industry estimates put private capital flows to the sector at $11-13 billion in 2025, the highest level since 2021, with investment concentrated in mature firms and capital-intensive activities such as space manufacturing and launch. Maintaining civil R&D investment will also be important for long-term competitiveness as public funding priorities increasingly shift towards defence. Civil space accounted for 6.3% of government civil R&D budget allocations across the OECD in 2024. While remaining modest in scale, civil space R&D is strategically important, and slowing growth could have implications for future innovation and competitiveness.

“The next wave of space innovation is already visible in scientific output and patent data,” the report explained. “Space-related scientific output has more than doubled since 2009, while participation in global research networks expanded from 80 countries in 2000 to 119 in 2024. Innovation is increasingly focused on areas including AI-enabled analytics, quantum applications, debris mitigation, in-orbit systems and advanced power technologies. Spacecraft electrical power alone represented 46% of space-related patent applications in 2023.”

Figures showed over 2020-2023, the United States accounted for 34.2% of space-related patent applications, followed by the EU27, and Japan. Countries outside the OECD region, notably China and India, have emerged as major scientific and technological actors.

By 2025, 109 countries had put at least one satellite into orbit. This increased participation means that keeping Earth’s orbits safe and usable is becoming an economic resilience issue. The report shows that almost $200 billion of economic activity is exposed to space debris risks. This makes orbital safety and future space traffic management essential not only for protecting the space environment, but also for safeguarding economic resilience, security and critical service continuity.

“While participation is broadening, independent orbital launch remains heavily concentrated, with only 12 countries, and Europe with the European Space Agency, possessing such capability by mid-2026,” The OECD concluded. “The United States accounted for 55% of orbital launches and 87% of launched objects in 2025, China for 28% of launches and 8.4% of objects. Participation in the space economy is broadening but the capacity to launch and operate at scale is not.”