HONG KONG’S FINANCIAL SECTOR UNDER CYBER ATTACK: ECONOMIC COST SOARS
The economic cost of the COVID-19 pandemic and global cybercrime has reached staggering proportions, with the financial sector being a prime target. According to estimates, the economic cost of the pandemic could reach US$6 trillion, while the annual cost of cybercrime is forecasted to hit US$6 trillion this year.
Forms of Cybercrime
Cybercrime comes in various forms, including:
- Phishing
- Ransomware
- Hacking
Its impact extends beyond financial losses to reputational damage, lost productivity and business disruption. The financial sector has been particularly vulnerable, with attacks increasing by 238% globally during the first three months of the pandemic.
Hong Kong’s Vulnerability
Hong Kong, as a leading global financial centre, is an attractive target for cyberattacks. The city has seen a significant increase in reported cybercrime incidents over the past decade, with cases rising from 2,206 in 2011 to 12,916 in 2020, resulting in economic losses of HK$148 million to HK$2.96 billion.
Government’s Smart City Blueprint
The Hong Kong government’s Smart City Blueprint aims to enhance cyberspace safety, but experts say more needs to be done to protect the city from cybercrime. A holistic approach is needed to coordinate policy responses and ensure that regulatory frameworks are aligned with international standards.
Regulatory Gaps
A lack of specific legislation dealing with cyber offences in Hong Kong means that regulation and oversight are fragmented across various government agencies and bodies. The establishment of an independent commission or cross-bureau working group could help coordinate efforts and improve response times.
Omnibus Cybersecurity Protection Law
The financial services sector is critical to Hong Kong’s economy, but its resilience is at risk if other sectors do not demonstrate a comparable degree of cybersecurity. An omnibus cybersecurity protection law could provide a core element of the city’s cybersecurity framework, while regular reviews of related statutes would ensure they remain fit for purpose and aligned with international standards.
Effective Cooperation
Effective cooperation between regulators, public and private sectors is crucial in addressing the growing threat of cybercrime. Hong Kong must continue to prioritize cybersecurity and work towards an overarching structure that meets evolving supervisory requirements across different sectors.
Conclusion
As the world looks ahead to a post-pandemic situation, it’s clear that governments, regulators and businesses need to take a closer look at the cost of cybercrime, which continues to rise. Hong Kong’s financial sector must be prepared to prevent and handle cyber risks, harnessing the power of public and private sectors to keep pace with international cybersecurity standards.