The relationship between cyber security and the economy has
only been growing stronger, with cyber attacks on the rise. Cyber attacks have
brought a new recognition of the importance of cyber security efforts. Attacks
have now become widespread, common, and expected in some firms. New attacks are
emerging within weeks due to an underground economy that has seen specialists
create built-to-sell malware to a waiting list of cyber criminals. The impacts
of cyber attacks have been felt and there are reports that these attacks are
only going to get worse. The current and forecasted impacts are a devastation
to the global economy. Here, we will introduce cyber security and link it to
cyber attacks and the global economy.
What is cyber security – a brief technical description
Cyber attacks have been on the rise and are targeted at
accessing, modifying, or deleting data, money extortion, and the interruption
of normal services. Cyber security is of great concern to today's businesses
since there has been a high adoption of information technology to achieve
efficiency and effectiveness in business operations. The current business
environment is such that there are many devices, systems, networks, and users.
All these are targeted by cyber criminals, and multiple techniques have been
devised and used against them. Cyber attacks are only becoming more effective
and sophisticated. Therefore, cyber security is becoming a survival mechanism
rather than a luxury for many businesses. Cyber security has multiple layers,
which cover devices, networks, systems, and users. These layers are intended to
ensure that these targets are not compromised by attackers. In organizations,
these layers can be compressed into three categories: people, processes, and
technology.
People
This is the category that includes users. Users are known to
be particularly weak in the cybersecurity chain. Unfortunately, cyber criminals
are aware of this and often target them rather than systems during attacks.
Users are the culprits in creating weak passwords, downloading attachments in
strange emails, and easily falling for scams.
Processes
This category
encompasses all the processes used by the organization. These can include
business processes, such as the supply chain, that could be exploited by
attackers to get malware inside companies. Supply chains are, at times,
targeted in organizations that are well secured against other methods of being
attacked.
Technology
Technology relates to both the devices and software used by
an organization. Technology has been a prime target for cyber criminals and
they have developed many techniques to compromise it. While security companies
try to keep abreast of the threats facing technology today, it seems that cyber
criminals have always had the upper hand. Cyber criminals can source new types
of malware from underground markets and use them in multiple attacks against
different technologies.
The scope of cyber security
The importance of
cyber security can't be overstated. The world is in a state of interconnection,
and therefore an attack on one host or user can easily become an attack against
many people. Cyber attacks can range from the theft of personal information to
extortion attempts for individual targets. For companies, many things are
always at stake. There is, therefore, a broad scope of what cyber security
covers for both individuals and corporate organizations
Critical infrastructure security
Critical infrastructure is systems that are relied on by
many. These include electricity grids, traffic lights, water supply systems,
and even hospitals. Inevitably, these infrastructures are being digitized to
meet current demands. This inadvertently makes them a target for cyber
criminals. It is, therefore, necessary for critical systems to have periodic
vulnerability assessments so that attacks that can be used against them can be
mitigated beforehand. There have been several attacks on critical
infrastructures in different countries. Commonly-targeted sectors include
transport, telecom, energy, and the industrial sector. The most significant one
was on Iran's nuclear facility. The facility was targeted using a speculated
state-sponsored malware called Stuxnet. Stuxnet caused the total destruction of
the nuclear facility. This just highlights the effect of cyber attacks against
critical infrastructure.
Importance of cyber security and its impacts on the global
economy
Cyber security has of
vital importance today ever since the world was networked. Many processes in
organizations are enabled by interlinked technologies. However, the penetration
of technology into normal lives and organizational processes has introduced
people to cyber threats. With every improvement in technology, the threat of
cyber attacks increases. New technology, such as IoT, have met the harsh
reality of cybercrime. However, current cyber security efforts ensure that the
use of technology is not hindered by cyber criminals. There are several reasons
why organizations and individuals are emphasizing cyber security; they are
outlined here.
The number of cyber attacks is growing
With the rapid development of technology, the number of
cyber attacks has been growing exponentially. Cyber security reports show that,
each year, there is a rise in the number of threats that have been detected for
the first time. There are specialists in underground markets that have focused
on creating new types of malware that they sell to hackers. Cyber criminals are
spending long hours doing background research on individuals and organizations
to find weaknesses that they can target. Social engineers are perfecting their
manipulation tactics to help them net more victims. At the same time, users
have not significantly improved or taken individual responsibility for their
own security or that of the companies they work for. The only hope in securing
individuals' data, money, and systems lies in enhancing cyber security.
Cyber attacks are getting worse
Cyber crime has evolved from what it used to be. The
aftermath of a cyber attack today is often devastating, as can be seen from the
companies that have fallen prey to cyber criminals. Yahoo lost its value after
it was confirmed that cyber criminals had penetrated its systems and stolen the
data of 3,000,000,000 users. Ubiquiti Networks lost over $40,000,000 to cyber
criminals that executed a social-engineering attack on its employees. Many
other top companies have lost sensitive data to hackers. Individuals are not
spared either. The WannaCry ransomware indiscriminately encrypted individuals'
and organization' computers in over 150 countries. In general, cybercrime is
getting worse. More money is involved, and huge chunks of sensitive data are
being stolen. The targets are not limited to small organizations, since big
companies, such as Uber and Yahoo, have already fallen victim. Cyber security
is therefore essential for organizations and individuals.
Impacts on the global economy
The economic implications of cyber attacks are being felt on
a global scale. Organizations are losing billions of dollars to attacks every
year. Forbes has estimated that with the current pattern, cyber crime will cost
the globe $2,000,000,000,000,000,000 in 2019. In 2015, this number was only at
$400,000,000. Prior to the estimate from 2015, early estimates done in 2013
reported that cyber crime only costs $100,000,000 globally. As can be seen, the
pattern has been such that the cost keeps growing. The World Economic Forum has
taken note of this, and with concern. It has warned that the figures could be
higher since a large percentage of cyber crime goes undetected. It has identified
industrial espionage as one crime where many victims don't even know that
they're victims.
Estimation of financial losses related to cyber crime
The financial losses related to cyber crime are incomparable
to the cost of cyber security. While cyber security costs remain almost
constant, cyber crime costs increase every year. In 2017, it was estimated that
annual breaches had increased by 27.4%.
The time it takes to resolve a cyber attack is becoming
longer than ever. It now takes an average of 23 days to recover from a
ransomware attack. Insider threat attacks take up to 50 days to recover from.
DDoS attacks take only a few days to recover from, but by then a lot of damage
will have been done. In general, the attack duration has increased and that
adds to the effects on the victims. The financial consequences can only go
higher with more exposure time to an attacker. Globally, the US has witnessed
the highest average cost of cyber attacks. The country's average has been
higher than the global average since 2017, when it was estimated at
$21,000,000. This estimate has grown from $17,000,000 in 2016. The second
country in the ranking of those with the highest cost of cyber crime is Germany;
it jumped from $7,800,000 in 2016 to $11,500,000 in 2017. Japan is third, with
an estimated cyber crime cost of $10,000,000. The UK, France, and Italy follow
with estimates of $8,000,000, $7,900,000, and $6,300,000, respectively.
Finance and cyber security
There is a strong relationship between finance and cyber security.
Finance can be viewed in two perspectives in line with cyber security. Finance
is used to procure cyber security products that can be used to prevent
cyber crime. Finance is also a direct victim of cyber attacks. Therefore, it
continues to be linked to cyber security. There have been attacks targeted
specifically at the finance departments in organizations. Other than this,
Chief Finance Officers (CFOs) are having to work closely with Chief Information
Security Officers (CISOs) in organizations to ensure that they adequately fund
their cyber security endeavors. Today, the links between finance and IT are
closer than ever.
Critical dependency of business, processes, and IT
infrastructure
Today, business is
run through computer systems that coordinate processes from different business
lines, while making the individual processes more efficient and effective. For
instance, in a production company, the supplies department has to be linked
with the production department, which then has to be linked with the sales
department. This type of chain will ensure that the supply department has
already procured input before the production department depletes the ones it
has. The production department will control its output depending on the sales
such that there is no over-production. To ensure that these three departments
continue to operate smoothly, the organization might acquire enterprise
resource planning (ERP) systems that will be integrated. The ERPs will ensure
that the supplies department automatically gets notified when the production
department needs more input. The production department will get actual and
forecasted sales to ensure that it doesn't overproduce products that may go to
waste. The ERP solution will be the backbone of all this coordination between
departments.
Economic loss
As a consequence of the increasing cost of cyber crime, there
has been a resultant loss in global and local economies. Based on estimates
from McAfee, it is expected that 2018 will see 0.8% of the global economy gross
domestic product being lost to cyber crime. This is estimated at
$600,000,000,000. Estimates for 2019 show that the economic loss will hit the
trillion-dollar mark. This shows that the economic impact of cyber crime is only
getting worse. In 2014, the estimated loss was at 0.7% of the global economy.
The US has seen a relatively constant increase in the number of cyber crimes
reported. Europe, however, has seen the highest rise in cyber crime. It might
appear that cyber criminals were once not particularly focused outside the US
market. With time, there has been an influx of hacking activity, and the hacks
have sporadically grown in the previously-unexplored Europe region. Also, since
the US has seen consistent cyber crime, organizations have been preparing
themselves for the attacks. Europe is now facing the highest economic loss to
cyber crime. An estimated 0.84% of its regional gross domestic product has been
lost to cyber crime. In the US, the percentage is at 0.78%
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