After Canada, China and India, Israel became the fourth non-European backer with the signing of an agreement in Jerusalem, the European Commission said in a statement.

Israel will help finance Galileo -- a joint venture between the European Union and the European Space Agency -- to the tune of 20 to 50 million euros (24 to 61 million dollars), a source told AFP.

According to the EU executive's statement, the agreement with Israel provides for joint work on research, satellite manufacturing, follow-up services and marketing.

The European project received a major breakthrough last month after the EU and the United States struck a deal ensuring interoperability between Galileo and the Pentagon's Global Positioning System (GPS).

The United States has been watching the development of Galileo warily for the past two years, fearing it could compromise US and NATO military operations which rely on GPS for navigation and troop location.

At one point, Washington suggested that the Galileo was an unnecessary rival to GPS that merely duplicated the US system.

But Europe has forged ahead with the project and Galileo is set to be operational by 2008 with 30 satellites encircling the globe in medium orbit for civilian and industrial use.

SPACE.WIRE