Unit 6 - Global risks and Resilience Flashcards
What is Cyber-crime?
A crime in which a computer is the object of the crime or is used as a tool to commit an offense (e.g hacking, child pornography, money laundering).
Who is at risk of cyber crime? How?
The worst-affected countries are the USA, China, Germany, the UK and Brazil. This is because as more areas of people’s lives become digitalised, the risks of cybercrime increases which is especially prevalent within these countries.
How much does cyber crime cost?
Costing countries millions of dollars every year. The average cost of cybercrime in seven countries was $7.7 million/year, with larger companies experiencing the higher costs.
Define hacking
Hacking can be defined as unauthorized access to a computer, network or system.
What are the two types of hackers?
Black hats hackers– Notorious for creating malware in order to infiltrate systems and are usually motivated by personal and financial gain. They can be amateur or highly experienced and will do anything from spreading malware to stealing personal details. Can steal, manipulate, destroy system.
White hats hackers– These are “ethical hackers” that may be employed by companies and governments as security specialists looking for vulnerabilities. Ethical hacking is considered an academic field and is taught through courses and training as well as conferences. One can even become a certified ethical hacker.
What are the threats to personal freedoms/individuals and businesses?
- Hacking
- Identity theft
- Email Scams
Example of hacking
In 1999, a 15 year old teenager, Jonathan James penetrated the computers of a US Department of Defense and installed a ‘backdoor’ on its servers which allowed him to intercept thousands of internal emails from different government organizations, including ones containing usernames and passwords for various military computers. He then used the information to steal NASA’s software, which controlled the temperature and humidity of the International Space Station, thus causing the system to shut down for three weeks. He was caught and charged, but later committed suicide when accused of collaborating with other hackers to steal credit cards information.
Define Identity theft
Identity theft is the deliberate and illegal use of someone’s information and identity in order to economically gain, obtain benefits, commit cyber crimes or even intentionally cause a loss to the victim.
Example of identity theft
In 2001, Abraham Abdallah tricked many credit card companies into providing him with information and then used the identities of some of America’s richest, including Warren Buffet and Steven Spielberg, to steal millions of dollars.
What is a response to ciber-crimes such as hacking and identity theft?
there has been a rise in surveillance and monitoring of users – which has been met with both praise and criticism.
Benefits of surveillance
- CCTV cameras can improve safety and reduce crime, especially at night when people are most vulnerable.
- Surveillance can help ‘catch’ criminals. For example, it only took the FBI three days to release photos of the suspects of the Boston Marathon bombing.
- It can help improve urban facilities. Live-cameras can be used to catch speeding motorists and traffic surveillance allows users to estimate travel time to their destinations.
Dangers of a surveillance society
- Mass surveillance is expensive and requires a lot of hardware to set up the entire system.
- Surveillance can easily be abused and used to blackmail or coerce people. The power of surveillance was brought to light by the 2014 Sony Pictures Hack. Hackers, who were allegedly employed by North Korean authorities, stole personal information from Sony employees and threatened to carry out a terrorist attack akin to 9/11 if the controversial film “The Interview” was not pulled from theaters. The ability for surveillance to hold such power makes it a dangerous tool to play with.
- Surveillance infringes on personal freedom. At a national scale, in January 2011, Ethiopian authorities filtered pictures of conflict and eventually cut off internet service to stop a revolt from spreading. This is an example of how personal freedom (e.g freedom of expression) can be compromised by surveillance of internet activities by the government.
Example of surveillance in China
In November 2018, Chinese authorities published a law that requires app providers like Alibaba and Tencent to keep a log of information about their users (including blog and chat room posts) and be readily available to provide this information and names of registered users to the government if they demand it. This is seen to be a direct infringement on personal freedom as users do not have total control over the content they use and contribute and are restricted and limited to what the government deems correct composure on the internet.
Define supply chain
a “network between a company and its suppliers to produce and distribute a specific product to the final buyer. This network includes different activities, people, entities, information, and resources.”
Political risks to global supply chain flows
- Brexit is a risk that is impacting heavily on global supply chains of major companies. For example, Honda Car manufacturing company has a plant in the UK. However, as a result of the uncertainties associated with the UK’s exit from the EU, the company has moved its production functions due to the implications this may have on its business.
- Presence of political demonstrations like protests – e.g. Foxconn iPhone components production in Vietnam was suspended following political demonstrations
- Rise in terrorist attacks – e.g. Daesh terror attacks that target holidaymakers in Tunisia have led to TNC supply shocks and a decreased tourist revenue.
Physical risks to global supply chain flows
- The Coronavirus pandemic affected the supply of raw materials for many companies in different parts of the world.
- Flooding in Bangladesh disrupted the supply of supply of cotton for clothing manufacturing companies in many parts of the world.
- The Ebola outbreak in West Africa in 2016 seriously affected the supply chains of most companies depending on raw materials such as diamond, cocoa, gold and other agriculture produce they obtain from the affected countries.
Economic risks to global supply chain flows
- Rising interest rates can cause havoc for firms that need goods at cheap prices.
- Trade restrictions imposed by governments. e.g. steel tariffs usa.
Define political sovereignty
The complete and absolute freedom of any country to govern itself or manage its own affairs, without interference from another country. Ideally, every country is a sovereign state, however membership to multi-governmental organizations such as the EU or UN can limit a country’s sovereignty.
Define economic sovereignty
The economic independence a country enjoys without any interference from another country – that is, by trying to influence market forces in the country. For example, the Francophone countries in West Africa ( Togo, Burkina Faso, Ivory Coast, Senegal etc) do not have full economic sovereignty, as the value of their currency is fixed by the Central Bank in France.
What is increased globalisation often associated with?
Increasing globalisation is often associated with the loss of political and economic sovereignty of most globalised nations. This is partly responsible for the growth of nationalism in most advanced countries such as the USA, UK, Germany and France.
Examples of loss of political and economic sovereignty
- The sale of part of UK’s iron/steel industry at Sheffield to the Indian Company, Tata, is viewed by some critics of globalization as the ‘sale’ of the UK’s economic sovereignty to India.
- Two major airports in the UK – Heathrow and Gatwick airports are owned by foreigners despite their strategic importance to the UK. Similarly, most ports in the UK, in places like Liverpool, are foreign owned.
- Some British clubs such as Manchester City, Chelsea, Leicester City are owned by foreign businessmen.
Define profit repatriation
The return of a company’s foreign-earned profits or financial assets to that company’s home country.
How does profit repatriation cause a threat to the economic and/or political sovereignty of states?
Profit repatriation is a form of threat that affects the sovereignty of states and undermines their capacity to effectively control TNCs, due to fear of losing them to other countries. It also undermines their capacity to raise revenue to undertake socio-economic projects in the country.
Define tax avoidance
Use of legal methods to minimise the amount of income tax owed by an individual or a business.
How does tax avoidance by TNCs threaten the economic sovereignty of their parent states.
TNCs practice tax avoidance by repatriating profits made in overseas countries to other countries with lower corporate tax rates, thereby threatening the economic sovereignty of their parent states. This may lead to a fall in the country’s GDP or reduce the country’s internal revenue needed for develop.
Define tax haven
Usually an offshore country with very low rates of taxation for foreign investors.
How may tax haven countries lose their sovereignty?
The countries that are the tax heavens may lose their sovereignty, such as the Cayman island. This is as the tax havens cannot change their economic policies due to the fear of retaliation, such as the TNC’s finding an alternative tax haven. This would cause the tax haven to lose all their income if the TNC’s leave.
Define a disruptive technology
A disruptive technology is any technology that displaces an existing one, resulting in a complete restructuring of the industry.
E.g. Drones and 3D printing
What is a drone?
an unmanned aerial vehicle (UAV) which is controlled by a person on the ground or remotely by a computer.
Advantages of drones
- They can be used for military combat, reducing the need for boots on the ground.
- They can be used in agriculture for spraying herbicides and controlling pests.
- Drones can be used for delivery of medical supplies – recently introduced in Ghana.
- In Canada, drones are used for courier services; delivering supplies to remote areas.
- Drones can be used in photography – to take aerial photographs.
- it can be used to study weather phenomenon – it can enter the eye of a storm (hurricane) to measure its characteristics.
Disadvantages of drones
- Drones can malfunction due to human or computer errors, causing damage to life and property.
- Drones can very expensive to purchase and maintain.
- Drones for military purposes can cause the accidental death of innocent people.
- Drones can invade a person’s privacy, in the case of drones with infrared sensors and powerful cameras.
- Drones can disrupt air transport, as it happened at Gatwich airport in the UK in December 2018.
