Cybersecurity and its critical role in the global economy – a very interesting topic indeed, and one that is taking center stage this week at the World Economic Forum in Davos after being identified as one of the top five global risks.
But before we get into the core of the subject, since cybersecurity is related to the internet and securing the data it carries, stores and transmits, we first need to examine the importance of the internet’s data flows and its effect on the global economy.
Data flows are the foundation of the global economy. With the present acceleration of digitization of global enterprises, supported by the quick adoption of evolving technologies like that of cloud computing and data analytics, the importance of data as an input to industries has increased, and this is not only for information industries, but also for other manufacturing and traditional industries. According to McKinsey Report, 75 percent of the value created by the internet is in traditional industries.
Internet adoption is highly correlated with economic development. The fact that higher internet penetration is highly correlated with a host of measures of economic success suggests that achieving universal access requires not only reforms to the telecommunications sector, but also policies for helping individuals and firms to make the most out of the internet.
Four billion people are connected to the internet, which is approximately half of the world’s population of 7.7 billion. Global ecommerce is growing at a phenomenal rate, with 1 billion consumers expected to make purchases across borders in 2020 (compared to 390 million in 2016), per the Global Ecommerce Association.
Thus, the internet and economic development reinforce each other. The internet has transformed the way we live, the way we work, the way we socialize and meet, and the way our countries develop.
McKinsey, in its report, compared the growth of the internet with the development and commercialization of electric power. As with electricity, the internet has changed the global landscape, bridged vast distances and made the world flatter by allowing instant access to an endless stream of information. It has impacted economic wealth for the masses, increased standards of living and contributed to growth.
We have seen that the internet and cyberspace play an important and positive role in shaping the global economy. Therefore, it is imperative that cyberspace is given adequate protection against unauthorized and illegal activities for which there are no ready-made solutions available. Individuals and organizations face attacks resulting in huge monetary losses.
According to McAfee and the Center for Strategic and International Studies, nearly 1 percent of global GDP is lost to cybercrime each year and the cost of cybercrime may be as much as US $600 billion. The report also points out that monetization of stolen data seems to have become less difficult because of improvement in cybercrime black markets and the use of digital currencies.
According to the 2019 Official Annual Cybercrime Report by Cybersecurity Ventures, sponsored by Herjavec Group, cybercrime is the greatest threat to every company in the world, and one of the biggest problems facing humankind. Cybersecurity Ventures predicts cybercrime will cost the world in excess of $6 trillion annually by 2021, up from $3 trillion in 2015. The report further adds that this represents the greatest transfer of economic wealth in history; cybercrime risks the incentives for innovation and investment, and will be more profitable than the global trade of all major illegal drugs combined.
Clearly, cybersecurity plays a key role in securing not only global enterprises and their infrastructure, but also the safety and well-being of people all over the world, along with securing the prosperity of global economy.
Therefore, the possible measures at a macro level for effective cybersecurity across the globe include the following:
- Every enterprise should follow secure practices and produce secure products and services, in addition to educating their employees thoroughly on safe and secure practices.
- Every country’s government should take measures to educate its citizens on cybersecurity awareness, in addition to aligning risk management and information technology activities and regulating private and public enterprises for compliance.
- All countries’ voluntary and universal adherence to acceptable cyber norms and international law for responsible state behavior in cyberspace will provide greater predictability and stability in cyberspace, as referenced by the US National Cyber Strategy of 2018.
- Countries should cooperate with each other to have a secure cyberspace and allow legitimate requests for extradition of criminals located abroad.
- Enterprises, academia and industry associations such as ISACA must build and maintain skilled human resources in cybersecurity.
- Countries should build strong detective and deterrence capabilities in cyberspace, in addition to having a robust incident response mechanism.
- Enterprises should follow the NIST Cybersecurity Framework and ISACA guidelines for benchmarking best practices.
- Finally, all countries should encourage internet freedom and pursue a multi-stakeholder model of governance, as well as the promotion of interoperable and reliable communication infrastructure and internet connectivity. This will lead to a robust information and knowledge economy, which in turn will lead to a prosperous global economy.
Author’s note: The views expressed in this article are of the author’s views and do not represent that of the organization or of the professional bodies to which he is associated.