Global Trend

Security Threats

Trade wars, cybersecurity breaches and climate change threaten global security and economic stability

The global community is facing challenges on international trade, the impacts of climate change and the growing severity of cyber warfare, all of which are impacting progress on sustainable development.

Governments and global companies are increasingly vulnerable to cybersecurity breaches, weakening their organizations as well as citizen trust.

Trade tensions threaten a weakening global economy, while climate change and other factors escalate conflicts in the Middle East, Central America and Africa and displace millions.

Signals to Watch

The Cyber Battleground

From state-sponsored cyberattacks, to terrorist cells, and the growing sophistication of lone hackers, the threats of cyberwarfare are growing. Increased digitization and automation, especially IoT and cloud computing, create more opportunity for cyberattacks. Hacking innovation continues to outpace the security built into existing technology. Government regulations lag ineffectively behind.

“Countries need to work together to tackle challenges that extend beyond their own borders. Countries should cooperate to reduce trade costs further and resolve disagreements without raising distortionary barriers. Cooperative efforts are also essential for enhancing cybersecurity, tackling corruption, and mitigating and coping with climate change.”
  • The World Economic Forum’s Global Risks Report 2018 identified cybersecurity breaches as one of the greatest risks to humanity. In its Top 10 risks cyber-attacks are ranked third in terms of Likelihood.

  • New deepfake technology allows the creation of digitally manipulated videos that can near-perfectly imitate anyone, from heads of state to military generals.

  • Malicious chatbots are becoming more widespread. Attacks now start with basic text-based bots, but could start to use human speech bots to entrap victims over the phone.

  • 2018 saw a number of high-profile cyber-attacks hit large companies including Facebook, Google+, British Airways, Marriott and T Mobile.

  • WhatsApp, a popular subsidiary of Facebook, was used to spread disinformation by Russian hackers in the lead up to the 2018 Brazilian election and may have played a role in the election of Jair Bolsonaro.

  • Facing criticism over the misuse of its platforms during national elections in Brazil, the US, France and the UK, Facebook has announced plans to increase ad transparency and defend against foreign interference ahead of the 2019 Lok Sabha polls in India.

Source: Identity Theft Resource Center

Trade Tensions Threaten Global Economy

The Trump Administration is attempting to reduce imports from countries with which the US has a trade deficit, disrupting trade negotiations with the European Union, Canada and Mexico, South Korea, Japan and, most importantly, China. Ongoing tension between the world’s two largest economies over trade is increasing the likelihood of a global economic downturn by 2020.

  • The breakdown of bilateral trade talks and the escalation of tariffs and other protectionist barriers by the US and China is beginning to hurt both economies.

  • Trade tensions could reduce international growth by around 0.5 per cent by 2020, the IMF reports.

  • The CFO of Chinese telecoms company Huawei was arrested in Canada over potential violations of US sanctions on Iran, outraging China and complicating trade negotiations between the world’s two largest economies.

  • As of writing, the US has agreed not to act on its recent threat to increase tariffs on $200 billion worth of Chinese imports from 10 percent to 25 percent.

From state-sponsored cyberattacks, to terrorist cells, and the growing sophistication of lone hackers, the threats of cyberwarfare are growing.

Climate Change Tops Global Security Threats

Climate change is increasingly recognized as the number one global security threat. Climate-related security threats include impacts to essential resources such as agricultural crops and drinking water, which can in turn exacerbate existing conflicts, as has occurred in Syria and Yemen. Further impacts include direct damage to infrastructure and communities from wildfires, storms and flooding, and effects on human health caused by greenhouse gases, associated pollutants, extreme weather and spreading diseases. All of these impacts can displace communities, increasing the number of global refugees and escalating geopolitical tensions.

  • Climate-related risks such as drought, crop failure, tropical storms and wildfires are significant contributors to conflict and displacement of large numbers of people in Syria, Yemen, Kenya and Sudan.

  • The latest National Climate Assessment conducted by the US government concludes that climate change is “presenting growing challenges to human health and safety, quality of life, and the rate of economic growth” and therefore poses significant national security risks.

  • Currently, over 65 million people are displaced globally for many reasons including conflict, famine and natural disasters, which is the largest number ever recorded by the UN Refugee Agency. The World Bank predicts that over 140 million people will be displaced by climate change alone by 2050.

What to Expect in 2019

The global community will see even greater convergence of geopolitical and sustainable development agendas, with worsening economic, physical and digital threats in 2019. Climate change impacts on global security will become more prominent. The increasing number of cybersecurity breaches and trade conflicts are likely to worsen geopolitical tensions and cost the global community billions of dollars. A potential global economic downturn may slow progress on sustainability if companies choose to respond by reducing their sustainability budgets.

What This Means for Business

  • Invest in cybersecurity

    Both governments and business are failing to keep up with hackers. All companies need to increase investment in cybersecurity, and tech companies in particular need to make a greater effort to work more closely with governments to help them enact regulation to better safeguard both companies and citizens.

  • Engage governments on trade

    Large companies need to work together, and with trade associations, to use their influence with governments and multilateral organizations to attempt to stabilize the current volatile trade relations between the US and other large economies, most notably China.

  • Analyze geopolitical risks

    Companies that analyze geopolitical trends will be able to better anticipate, and be prepared, for disruption even if this comes in increasingly unconventional and complicated ways.

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