U.K. Says Disruption to Satellite Navigation Would Cost Billions

(Bloomberg) -- A sustained disruption to navigation systems would cost the British economy 1 billion pounds ($1.3 billion) a day, the U.K. government said, as it outlined steps to develop its own alternative to the European Union’s Galileo satellite array.

The damage estimate takes into account a “sustained” disruption to systems that “are increasingly important for commercial, military and other critical applications,” the government said late Tuesday in a statement. The systems help guide ships, aircraft, missiles and passenger cars.

The U.K. will plow 92 million pounds into an 18-month study to design and develop Britain’s own satellite navigation system to ensure the country’s security after Brexit, the government said. It would replace Galileo, the EU’s equivalent to the U.S. Global Positioning System, or GPS.

While Britain has played a leading role in developing Galileo, the EU says the U.K. won’t have full access to its most secure elements after it leaves the bloc.

“We cannot be an ‘end user’, shut out from security discussions and contracts, and without critical information about the system’s security,” Prime Minister Theresa May said. “Use of something we are unable to rely on has little value, and we cannot justify paying towards that.”

British ministers are still trying to talk their EU counterparts around, but the bloc has already brought in rules that exclude British companies from the next round of commercial work. Britain “would be obliged to end its participation in the project” without access to its secure elements and commercial work, the government said in the statement.

“Unless we receive assurance that we can collaborate on a close basis in the future -- like the close security partners we aspire to be -- we are clear that we will withdraw U.K. support for Galileo and pursue our own sovereign satellite system,” May said, noting that the investment announced on Tuesday shows her words are “not an idle threat.”

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