Cyber crime and government surveillance pose a risk to the internet comparable in scale to the 2008 financial meltdown, the World Economic Forum (WEF) has warned.
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The global economy faces a potential “Cybergeddon”, in which businesses and the public lose trust in the internet, it said in a report published in the run up to its conference in Davos this month.
The WEF’s Global Risks Report, warns of a potential future in which hackers, organised crime, and nation states disrupt the internet to such an extent that it becomes a no-go area for large sections of the population.
“The internet may become less resilient, more fragmented and less valuable. The loss of trust could be compared to the loss of trust [experienced by] the financial system,” said Alex Lehmann, chief risk officer at Zurich Insurance Group, which contributed to the report.
Businesses are now less trustful of the internet after cases of online espionage committed by the UK and US, which could make the internet more difficult to govern.
As concerns about government spying grows, countries are more likely to follow the lead of Brazil or the EU by considering laws to ensure data on their
Most likely risks
- Income disparity
- Extreme weather
- Unemployment and underemployment
- Climate change
- Cyber attacks
citizens does not leave their own jurisdictions.
Concerns about the US hosting ICANN, the governance body for the internet could lead to further ‘balkanisation ‘of the internet, the report says.
The main casualty may not be companies or nation states but individuals who are concerned about online privacy.
Young people, disillusioned with traditional politics, may increasingly see governments as an online aggressor to be confronted, it warns.
“The most transformative technology since Gutenberg would regress to the loss of societies, economies and humanity,” it claims.
The internet faces growing threats from hackers and cyber-criminals. Attacks have been contained so far, the WEF says, but a future in which attackers are able to overwhelm defenders could just be ‘one disruptive technology away.
Internet of things
The trend towards connecting devices, such as sensors, electricity meters, and other devices, raises the prospect of cyber crime having an impact not just on IT systems, but on critical infrastructure.
Risks with biggest potential impact
- Financial crises
- Climate change
- Water crises
- Underemployment and unemployment
- Critical information infrastructure breakdown
John Drzik, president of global risk and specialities at Marsh & McLennan, warned that a major cyber incident could trigger a domino effect, with consequences for the global economy.
Securing against cyber attacks requires a lot of co-operation between countries and governments, he said, but if trust is eroded, nation states could withdraw from international agreements.
“We feel we are in an scenario now, if a couple more dominos fall, it could start to create enough of a fractured geo-political environment that it would be hard [for countries] to reach agreement in any area,” he said.
Download the WEF Risk Report
Businesses need to be aware of geo-politics and diversify their risks, he said.
“Look for creative coalitions and partnerships that can create opportunity in this type of climate, and just generally invest more in risk management capabilities,” he said.
The report, which assesses the biggest risks facing the world, identifies income disparity between rich and poor, extreme weather, and climate change, and cyber attacks, as the risks most likely to have a global impact over the next ten years.