Posted: Sat, Apr 26, 2003, 11:24 AM ET (1524 GMT)
Spanish officials have blocked an agreement among European Space Agency nations to release funding for the Galileo navigation system, according to a published report. Dow Jones Newswires reported late Friday that Spain exercised its veto during an ESA meeting Friday in Brussels because it was dissatisfied with how contracts for the system would be allocated among ESA nations. A dispute between Germany and Italy regarding how contracts would be divvied up blocked ESA approval of funding for the initial stage of the project for several months, but the two nations reached an agreement in late March that appeared to clear the way to release 550 million euros (US$605 million) for the effort. Galileo is a joint effort between ESA and the European Union to develop an alternative to the American GPS system. EU officials warned last month that unless ESA settled its differences among its member nations in the near future, the EU would proceed alone. The first Galileo satellite must be in orbit by 2005 to meet a deadline established by the International Telecommunications Union for use of the frequencies allocated to the project.

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