Finance should pay much more attention to undersea cables risk

Underwater cables, not the mythical"cloud", carry over 99 per cent of global internet traffic, including $10 trillion in daily financial transactions. Photograph: stockWhat is the greatest tail risk stalking global finance today? There is a depressingly long list of options: surging debt, volatile rates, geopolitical conflict and/or cyber failures like the one accidentally unleashed by CrowdStrike and Microsoft. But there is another deserving far more debate: underwater sea cables.

These cables can be damaged by natural disasters , accidents or deliberate attack. The problem is akin to the issue that erupted with French railways during the Olympics: if someone sabotages a link, traffic stops.Guinness flows but Diageo’s profits dry upThe good news is that internet engineers are keenly aware of this, and are already repairing around 200 faults on the 500-odd existing cables each year, mostly due to accidents. Better still, awareness is rising in some financial quarters.

Meanwhile, mysterious incidents are proliferating. In 2022, the Baltic Nord Stream gas pipeline was sabotaged. More recently Sweden reported sabotage to a data cable and Estonia is in a diplomatic tussle with China around an alleged “accident”. However, the Rogucci team considers it unrealistic to expect navies to defend all the estimated 1.4 million kilometres of subsea cables. It thinks that Washington’s priority, along with its allies, should be to create engineering solutions for network resilience on the assumption that a disaster will eventually happen.

“An effective defensive response cannot be prepared and executed successfully at the level of the disparate private enterprise interests,” it insists, adding that if Nato wants to create true “insurance” against attack, it should spend $10 billion installing backup cables.One problem is that the military industrial complex generally prefers to lobby for expensive new submarines, not cheap repair ships.

Australia Australia Latest News, Australia Australia Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Finance Ireland rules out mortgages reboot until 2025 ‘at earliest’ as banks hog marketNonbank lender drastically reduced home loan business as interest rates soared
Source: IrishTimes - 🏆 3. / 98 Read more »

Farming couple allege Pepper Finance is pursuing them over debts fully repaid 12 years agoA judge said that a 2012 letter, if proved correct, makes the case ‘truly astonishing’
Source: IrishTimes - 🏆 3. / 98 Read more »

Finance Minister gives update on cost of living measures for Budget 2025The Budget won't be for another couple of months with Finance Minister Jack Chambers confirming 1st of October as the announcement date - but measures are already being discussed
Source: RSVPMagazine - 🏆 7. / 76 Read more »

Private money essential to secure supply of new homes, Department tells Minister for FinanceClose to €20 billion a year needed if we are to build 50,000 homes annually, officials told Jack Chambers on his appointment
Source: IrishTimes - 🏆 3. / 98 Read more »

Finance officials concerned about oversight of auto-enrolment pension schemeLegislation holds planned new mandatory workplace pension scheme to lower regulatory standards than private sector rivals
Source: IrishTimes - 🏆 3. / 98 Read more »

Digital marketing firm Ebow sells majority stake to finance expansion plansIrish firm has retained a broker to identify potential acquisition and merger candidates, says founder
Source: IrishTimes - 🏆 3. / 98 Read more »