Australia vulnerable to cyber attack and economic blackmail, report argues

(QESP Editor’s Note: The following is a reprint of a November 13, 2017 article by David Donaldson in The Mandarin. The original is available at https://www.themandarin.com.au/85963-australia-vulnerable-cyber-attack-economic-blackmail-report-argues/)

Australia is vulnerable to emerging methods of interference by foreign states such as economic blackmail and the type of cyber attacks Russia has used against other countries, warns a new paper published by the Committee for the Economic Development of Australia.

While asylum seekers coming by boat, terrorism and a naval attack by China are the three most commonly named security problems named by members of the Australian public, they “are not the main security threats to national wellbeing that Australia and its regional partners now face,” writes Professor Greg Austin in a chapter on cyber security.

Complex, emerging threats such as cyber security are more difficult to understand and explain, and are thus less attractive to politicians and the media, but should not be overlooked, he argues.

Austin, professor at the Australian Centre for Cyber Security at the University of New South Wales Canberra and a professorial fellow with the EastWest Institute, says Australia is behind but investing heavily to catch up on cyber security:

“The Australian Government places great importance on military security in cyber space both for its own sake and for its potential role in international collaboration for mutual economic benefit and national economic prosperity. The Australian Defence Force is on the cusp of a revolution as it prepares to reorganise for cyber-enabled warfare; and the Australian cyber security industry is set for significant growth.

“The military shake-up comes two decades late, and the country faces some security penalties because of the delay. Ironically, the country also stands to gain from the delay as related technologies have moved very rapidly. What once seemed like a discrete sub-sector in the civil economy (cyber security) has now become transformative of national defence as it blends into other technologies like robotics and advanced artificial intelligence, including exploitation of big data and high-performance computing.”

China and the United States would move to disable the adversary’s military and civilian cyber technologies if war eventuated, or perhaps even pre-emptively, the report notes. This presents “almost insurmountable” challenges for middle powers like Australia.

“The country does not now possess such capabilities, nor is it close to achieving them,” argues Austin. “It has not even begun planning for most of them. This can be a growth area for Australia’s cyber security industry.”

Money talks

Australia’s regulation of potential economic threats has also failed to keep pace with the changing security environment.

“Where Australia appears relatively ill-prepared is in its readiness to deal with unconventional sources of influence,” argues the ANU’s Michael Wesley, in his chapter on international security.

Wesley, a professor of international affairs and dean of the College of Asia and the Pacific at the Australian National University, is concerned Australia is not thinking enough about China’s capacity to use money to get what it wants:

“The tenor of debate in Australia about Chinese investment, and influence on Australian political parties and universities has reached unprecedented levels over the past year, arguably reflecting a lack of preparedness or clear strategy in Australia for countering unwelcome influence.

“It is not unreasonable to assume that Australia may well be already a prime target for non-violent rivalry among the great powers; however, its political and economic regulatory settings remain designed for a world of uncontested western primacy. This is arguably Australia’s most serious vulnerability in the years to come.”

Cyber security an economic growth area

Strengthening cyber capability also dovetails with economic development. Although governments — Victoria and the Commonwealth in particular — have been making strong efforts to attract companies and grow the civilian cyber security economy, direct government investment for its own cyber security purposes will be the most effective way to grow the market, thinks Austin.

“Cyber security for national military defence is a very different phenomenon from cyber security for the defence of enterprises and individual citizens (the civil sector). The Australian Government has staked much in public on development of civil sector cyber security capabilities, through industry promotion and development of a much-needed national skills base.

“This is a sort of techno-nationalism (protectionism) that is somewhat out of touch with the realities of a globalised knowledge economy in which US and European firms dominate. Many services for cyber security in Australia are already provided remotely (offshore) through system and network monitoring.

“In stark contrast, the needs for military defence and national security in cyber space can only be met by a sovereign, non-globalised knowledge economy open to the outside only through our closest intelligence allies in the “five eyes” community (the United States, United Kingdom, Canada, New Zealand, and Australia). Australia can and should compete in niche areas in the globalised civil sector economy of cyber security, but it will be the developments in areas of sovereign capability that will provide a quantum leap to our industrial base in the civil sector. This is a key lesson from the political economy of cyber security in Israel and, to a lesser extent, in Taiwan.”