I previously discussed the growing awareness in the United States of the risks associated with cyber and digital systems, yet many business enterprises still lack hardened security programs capable of protecting sensitive information. Nation-state espionage has taken on a new popular form over the past decade, and American civilians are slow to grasp this new phenomenon of espionage tactics. Businesses and government have fallen in love with the benefits of new technology, but due to a preference for the ease of data that technology brings, many are still hesitant to address this new set of issues and vulnerabilities presented by our technology systems. . The reality is that today cybercrime and cyber espionage are huge business opportunities for individuals and nation-states. This new form of espionage is affecting the economic and political relations between countries and has changed the shape of modern warfare to be filled with sneaky and covert attacks; often going completely unnoticed by those whose victims are ignorant about the underlying goals of the attacker.

Where does most of the “cyber leak” come from?

A formidable threat to the strength and competitiveness of the US economy is China, but what the American public largely fails to understand are the Chinese strategic goals behind the draining of trade data and intellectual property from industry. from USA

China views cyber warfare as a valid form of international military and commercial competition, and pursues what it calls “information dominance.” Mandiant recently tracked many of the attacks by the US Cyber ​​Warfare Unit.

These types of low-grade commercial cyberattacks are also increasingly originating from other countries such as Russia, Taiwan, Turkey, and North Korea; Many of the most recent and notable damaging intrusions can be traced back to China. Until now, Chinese cyber attackers have been able to carry out their thefts of military and economic secrets at virtually no cost.

Many countries engage in economic espionage using cyber, but the Chinese are by far the worst actors. A report generated by the National Counterintelligence Executive Office stated: “The People’s Republic of China is the world’s most active and persistent perpetrator of economic espionage, the Chinese government has stolen millions upon billions in American R&D in this ongoing assault.” to our economy, and America’s competitive advantage will continue to erode until our government defends our national interest by taking effective countermeasures.” I encourage corporate America not to wait for Uncle Sam to give them the cyber protection they need; it won’t come quickly and probably not fast enough.

It is important to note that it is not only the largest companies that are vulnerable, the biggest increase has been in attacks against small and medium-sized businesses. Recently an industry report noted that a US furniture company with 100 employees had designs stolen and it was reported that six months later the Chinese were shipping furniture to the states at half the price, quickly company went bankrupt. Whether throwing steel or stealing secrets, the Chinese’s motive is the same: to keep their economic engine running and maintain stability at home while undermining the economic power of the United States.

Researchers at the Heritage Foundation’s Center for Foreign and National Security Policy said: “The Chinese bet everything on this (stealing secrets) because they have virtually no R&D. The only way to keep up with Western economies is to steal.” . They take everything, then sort through what they have and discard what they don’t need.” To put the R&D problem between our two countries into perspective, per capita, China’s R&D spending is $248.16 compared to US spending of $1,275.64 Clearly the Chinese are relying on someone else’s R&D rather than their organic efforts Chinese companies have already been sued for stealing DuPont’s patented method of making chemicals used in plastics and paints.

What does oil have to do with cybernetics?

It is also important to note the play that China’s economic growth rate has and the meaning for other nations behind its continued expansion. Industrial growth in China also requires a high level of energy consumption to fuel its continued growth; Currently, China does not have an excess of energy resources, but rather barely enough each year to meet its high demand. Chinese GDP has undergone a massive expansion over the past two decades, China’s annual GDP growth rates have ranged from increases of 3.8% to 15.4%, and have averaged over the past few years around a 6% increase. 8%. These are staggering growth rates, but equally as staggering is the number of energy sources required to power its continued growth. China is the main driver of the increase in energy demand until 2020, its consumables are mainly composed of coal, oil, gas and other resources. One point of concern must be acknowledged, China has not yet secured an adequate supply of energy resources for its expected future demand. This power supply shortfall could have drastic results if not covered; China’s leadership will not sacrifice its GDP so that it falls a lot due to the mere lack of the required energy supply. A very low GDP could have devastating results throughout China’s economy and act as a domino effect in continued declines; China is unwilling to consider this option and is therefore taking more extreme measures to increase its supply of energy resources. The energy required by China to produce commodities for world consumption and to maintain its high rate of GDP could be considered a “Red Line” problem for China in the future. These demands have motivated China to be smarter in methods to meet its future energy demands and complement its economic development; stealing information and IP is a good option to help meet future needs.

Faulty economic and media reports are still circulating suggesting that China does not have resource deposits similar to the US and Canada, therefore Chinese motivations for partnering are altruistic to simply get good investment. Reports from China’s Ministry of Land and Resources and assessments from the Oil & Gas Journal have estimated that China actually has 24.6 billion barrels of proven oil reserves (a high degree of confidence to be commercially recoverable). How much is technically recoverable? China itself does not have the necessary technology required to recover deep or offshore reserves nor can it successfully perform horizontal drilling recovery without the Western companies that developed these capabilities and currently possess this crucial drilling and recovery information.

We see the ongoing territorial disputes in the East China Sea, the South China Sea, the Spratly and Paracel Islands, which are home to large-scale oil and gas fields. China is in a ‘total cut-off press’ to desperately secure resources for its future energy demands.

It is also interesting to note that China’s total oil and liquids production has increased in the last 20 years, similar to its rate of cyber and corporate espionage. As China’s production and supply shortfalls worsen, compared to its rising rate of consumption, we will also see China’s motivations and tactics increase proportionately.

Chinese oil company Cnooc aggressively pursued overseas deals with Canadian and US oil producers, resulting in its expanded resource base. However, these Chinese companies that invest in US and Canadian crude are just as concerned about acquiring the technology and knowledge of these deals as they are concerned about the promise of sending some of that oil home.

How much is China costing the United States?

Today, cyberattacks cost businesses $400 billion to $500 billion or more a year; 71% of data breaches now target small businesses and 60% of small businesses that have experienced a data breach are out of business within a year of the breach. The National Crime Prevention Association reports in 2015 that 45 percent of all US businesses reported specific losses from intellectual property theft. These digital information thefts cost US businesses $250 billion a year. 2014 reports from the Center for Responsible Business and Trade and PricewaterhouseCoopers (PwC) estimated that trade secret theft costs the US and other advanced economies between 1% and 3% of their GDP on average every year. year. Intellectual property thefts do not discriminate; they threaten all major industries, medium and small businesses alike.

It is recognizable that the proliferation of counterfeit products on the market is directly proportional to the reduced strength of the US economy. Businesses lose profits, labor demand declines, employees lose their jobs, and then consumer spending falls.

It is time for citizens to take notice of the growing trends and compounding impacts of low-grade cyber theft in America. It is essential to understand the global motivations and chameleon tactics that are used, through technological systems, to steal jobs and global competitiveness from our economy.