Outer space, explained.
A Long March 12 carrier rocket carrying internet satellite group blasts off from the Hainan Commercial Spacecraft Launch Site, 10 October 2026, Wenchang, Hainan Province, China (VGC via Getty Images)
China is not privatising its space sector but folding entrepreneurial firms into a wider state system.
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Order No. 837: Beijing’s rules for China’s rocket exportersOrder No. 837: Beijing’s rules for China’s rocket exporters
China’s most interesting space story this year may not be any single rocket launch.
In August, Chinese commercial launch company LandSpace successfully landed (Opens in new window) the first stage of its Zhuque-3 rocket after an orbital flight, bringing reusable commercial launches closer to reality. A few weeks later, Galactic Energy’s Pallas-1 made a successful debut flight (Opens in new window). Other companies (Opens in new window) are pushing ahead with their own reusable launch systems (Opens in new window).
The striking development is not simply that China now has more space companies. It is that Beijing is giving them more room to compete while drawing them more deliberately into the country’s wider space ambitions.
China says more than 600 (Opens in new window) commercial space enterprises now operate across launch, satellite manufacturing and downstream applications such as communications, remote sensing and data services. In 2025, commercial space missions accounted for (Opens in new window) 50 of China’s 92 launches; they placed 311 commercial satellites into orbit. Yet only half of those missions used commercially developed launch vehicles.
That apparent contradiction is insightful. China’s commercial-space sector is not emerging as an alternative to the state program. It is becoming another way of delivering national space capability. The policy architecture makes that explicit.
China’s 2025–27 commercial-space action plan (Opens in new window) calls for incorporation of commercial activity into the country’s overall space-development system. It opens state research and testing facilities more widely, encourages government procurement of commercial launch and satellite services, and promotes greater participation (Opens in new window) by companies in national and international programs.
Beijing also introduced (Opens in new window) its first dedicated commercial-space standards system. More than 1,000 standards are planned (Opens in new window) across six broad areas – spanning rocket and satellite manufacturing, launch and tracking, market access, licensing, safety, debris mitigation, certification and space-based services. The aim is not simply to achieve technical consistency; it is to create the operating rules (Opens in new window) for a much larger commercial space economy.
China is doing two things at once: encouraging space companies to become more entrepreneurial and international while building the rules needed to keep that expansion compatible with national priorities.
This is not privatisation in the familiar sense. Nor is it simply old-style state direction. It is an attempt to combine the speed and experimentation of competing commercial companies with the infrastructure, procurement and long-term objectives of a national program.
That matters because China needs much more launch capacity. Large satellite constellations, lunar exploration, human spaceflight and scientific missions all compete for launch opportunities. Multiple providers and reusable rockets could lower costs, increase cadence and make the system more resilient when individual vehicles fail.
But Beijing also wants its commercial companies to look outward.
The same action plan encourages them to expand overseas and help smaller space-faring nations build satellite applications. We have already seen an early example (Opens in new window) in Thailand. In August, Beijing-based commercial satellite company GalaxySpace delivered (Opens in new window) the Lingzhi-09 CubeSat to Thailand’s space agency, GISTDA (Opens in new window), together with ground systems, training and technical support.
The company described it as the first complete in-orbit satellite delivery by a Chinese commercial space firm to a Southeast Asian customer. That may be the beginning of a more consequential export model.
China has exported satellites (Opens in new window) for years, usually through state-linked corporations (Opens in new window) such as China Great Wall Industry Corporation and often under government-backed agreements (Opens in new window). Commercial companies can offer something different: smaller spacecraft, integrated services, training and potentially faster procurement.
For emerging space countries, that could widen the menu of available partners. If that model scales successfully, Chinese commercial companies could become an important interface between the country’s space capabilities and emerging markets. The significance would lie not only in selling satellites or launches but in supplying the training, software and technical relationships around them.
The policy challenge is that going global also means deciding what can travel with these companies, and what cannot.
NASA/Unsplash
Order No. 837 (Opens in new window), China’s new outbound-investment regulation (Opens in new window), took effect on 1 July. It is not a space regulation (Opens in new window). Its purpose is broader (Opens in new window): to support high-quality overseas investment while strengthening the legal framework governing it. But it is relevant to a sector in which commercial products can contain strategically sensitive technology and data.
The regulation makes clear that China wants companies to invest overseas while observing existing rules on export controls, technology transfer, cross-border data and security review. It specifically covers technology, services, data and even some forms of overseas technical training.
There is no evidence so far that Order No. 837 has blocked or materially altered a particular commercial-space deal. Its significance is more subtle.
China is doing two things at once: encouraging space companies to become more entrepreneurial and international while building the rules needed to keep that expansion compatible with national priorities.
That may prove to be the defining experiment in China’s commercial-space boom. The experiment therefore cuts both ways. Commercial firms gain room to move faster, attract capital and pursue overseas customers; Beijing gains additional capacity without abandoning coordination.
The question is no longer whether private companies can find a place in China’s space sector. They clearly can.
The question is how far they can become global commercial actors while remaining part of a coordinated national system.
The answer will matter beyond China.
About the author
Richard de Grijs
Richard de Grijs (Opens in new window) is Professor of Physics and Astronomy at Macquarie University and former Executive Director of the International Space Science Institute–Beijing.
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