Europe has developed a reputable technological and industrial space capability and has become the third space power of the world after the former Soviet Union and the USA. It has maintained this position by making a significant investment in the European Space Agency (ESA) and through complementary national programmes. The first of two studies which the Commission has launched is called "A synthetic view and a prospective analysis of the space sector in Europe". The collapse of the Soviet Union has abruptly changed the political and economic context within which space programmes are proposed. Furthermore, the growth of national and European space budgets has come to a halt. The end of the cold war is forcing a review of the space activities in Europe and elsewhere. Cross-border mergers of the space operations of large aerospace companies in Europe are evidence of this trend. The European Commission, in its Communication on Space (COM(92) 360 final) referred to the need for the Community to contribute more towards Europe's space effort. The Commission's intention is to is to make an efficient contribution both to the definition and the implementation of a comprehensive European space policy. At this stage an independent up-to-date analysis of the complex political, economical and social context of the European space activities will provide an important background for this process, and will thereby make a useful contribution to the discussions on further Community action (definition and implementation of policies, coordination or legislation). This study is part of a coherent European planning effort and in-depth analysis of the space-related activities in the European Union. The Commission has recently initiated a second study entitled "Japan in Space: Challenges and possible opportunities for Europe." Japan is emerging as a participant in the global aerospace and defence industry, as continuing growth in its domestic market helps Japanese firms position themselves for a broader role in US and European markets. This expansion is the direct result of a series of decisions which reflect a Japanese policy aimed at establishing a world-class aerospace industry, built on technology, quality and shorter development cycles. At the same time, US and European aerospace companies, which have concentrated on domestic markets, now face an accelerating globalization of the industry and a growing competition beyond domestic boundaries. The key factors driving these changes are the new geopolitical situation, budgetary constraints, high development costs and increased complexity requiring involvement of multiple companies and shared technologies. In its Communication on Space (COM(92) 360 final) the Commission has recognized that the Community has an important contribution to make in helping to ensure the successful development and exploitation of space. It also recognizes that because of its competencies in a number of relevant areas, the Community has become a central component in Europe's space effort, and can make an effective contribution both to the definition and implementation of a comprehensive European space policy. Following the Communication "A consistent and global approach: A review of the Community's relations with Japan" (COM(92) 219 final) by the Commission, on 15 June 1992, the Council underlined the importance of industrial cooperation in the EC-Japan relationship to support cooperation in science and technology. The second study will make a detailed assessment of the potential evolution of the Japanese space sector and the challenges and opportunities for the space sector in the European Community. The Commission has completed a number of other studies which are available for consultation. They are: - "A prospective assessment of future space technologies with converging interests for other sectors"; - "Dispersions and colloid systems: the significance of microgravity and possible industrial applications"; - "The potential for enhancing the use of EUMETSAT meteorological data in climatology; - Study on the assessment of the potential of satellite navigation systems and the European dimension of their use; - Assessment of technical, economic and policy issues associated with the development of future aerospace planes in Europe; - Use of satellite data for environmental purposes.