Although Galileo has already suffered numerous setbacks, the EU still has high hopes that it will spur the development of numerous new technologies that will make the wait well worthwhile.

Satellite navigation, which allows users to pinpoint their location anywhere on Earth, is expected to be at the heart of new technologies for steering cars or guiding boats as they arrive at ports or airplanes as they come into land.

It could also be used in accident assistance, search and rescue missions, monitoring fishing boats or container ships as well as mineral prospecting by miners, building pipelines, financial transactions or various leisure activities.

Galileo, which users will have to pay a fee to use, was originally intended to have an edge over the free GPS system by allowing users to locate their position within a metre compared with about 10 metres for GPS.

The EU has also long justified spending billions of euros to build Galileo on the grounds that Washington can turn GPS off for civilian users during conflicts, as happened during the Gulf war.

However, the United States is developing a third-generation version of GPS that would be both more precise and more resistant to hostile jamming.

At the same time, Russia is updating its Glonass system while the Chinese are also developing their own programme.

Galileo will eventually consist of a network of 30 satellites orbiting at 20,000 kilometres (12,400 miles) on average.

So far, only a single test satellite has been put into orbit, in December 2005, and the launch of a second has been been delayed.

The first four satellites of the network already have financing but EU member states were struggling for months on how to fund the rest until they reached an agreement on Friday.

EU transport ministers are due on Thursday to decide on how to divvy up the work among contractors for the remaining 26 satellites that will complete the network.

While building Galileo, the European Union is also developping a system known as EGNOS, which is supposed to improve the quality of GPS signals.

Galileo, which currently is not intended to support military activities, and GPS are supposed to be compatible for users.

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