The economy's impact on critical infrastructure, sectors and processes could threaten national security in a number of ways. Researchers examined relationships between the economy and national security, focusing in particular on the characteristics and performance of the economy of the Netherlands and the consequences this may have for its national security.
Background
National security is a term that is often understood and expressed by the threats faced by a state, for example from terrorist attacks. However, its scope can be broader than that: National security can also be understood as the protection of infrastructure and sectors that are critical for the uninterrupted functioning of a nation’s economy.
This interpretation of national security highlights the strong interconnectedness between security and the economy in a system that is complex, interdependent and involves multiple variables.
Goals
The Dutch Research and Documentation Centre (Wetenschappelijk Onderzoek- en Documentatiecentrum, WODC) commissioned RAND Europe to develop insights into the relationships between the economy of a country and its national security, focusing in particular on the Netherlands.
This study is intended to support the National Coordinator for Counterterrorism and Security in exploring the concept of economic security based on a broad and international range of perspectives.
Methodology
The study involved different approaches, including a review of academic and policy documents, interviews and the development of an analytical framework used to conceptualise the relationship between the economy and national security.
Building on the international literature and the conceptual framework, researchers analysed what developments and trends within the global, EU and Dutch national economy can have an impact on the national security of the Netherlands, and where vulnerabilities may exist within the Dutch system.
Findings
The impact of the economy on critical infrastructure, sectors and processes could threaten national security in a number of ways:
Foreign direct investment (FDI) and ownership of critical infrastructure and sectors can increase the risk that foreign entities gain influence and control over their operations.
Espionage and access to sensitive information could be enabled by the close proximity or ownership of critical infrastructure and sectors by a foreign body.
Natural resource dependence on imports from foreign countries could give foreign actors undue influence on the national economy.
Supplier dependence for the provision and maintenance of critical infrastructure and processes can arise when there is a skills and technology gap, which leads to a reliance on an external provider for talent or services.
Government intervention through expenditure, economic policy and regulation can have a strong influence on the quality, availability and resilience of critical infrastructure, sectors and processes.
Corruption and fraud could undermine the resilience of critical infrastructure and potentially open up opportunities for malicious actors to obtain physical or digital access to sensitive assets and information.
Socio-economic inequality resulting from factors such as economic policies and neoliberal market forces could reduce the ability of citizens to provide for themselves, as well as risk social unrest and domestic instability.
In addition, a number of global economic and geostrategic trends could present risks to critical infrastructure, sectors and processes and therefore should be considered alongside an analysis of risk vectors linked to macroeconomic events and variables. These trends include:
Digital transformation and the implementation of industrial Internet of Things could bring challenges in relation to the security of supply chains, cyber security, and risks of data espionage in critical sectors and processes.
Globalisation and interdependence between the critical infrastructure, sectors and processes of one country with others could magnify risks to its national critical infrastructures.
International economic trends shape growth opportunities as well as the complex risks that face critical sectors of the economy.
The political and economic paradigm of foreign states may have implications for national security, with different national economic models impacting the competitiveness of critical sectors and processes.
Uncertainty in relation to resource security could pose risks, for example due to a reliance on foreign suppliers for energy and the uptake of alternative energy generation, distribution and storage technologies.
Potential concerns with regard to information integrity and trustworthiness may act as an avenue for malicious actors to disrupt critical processes such as elections and democratic decision-making, and gain influence in critical sectors such as telecommunications or political institutions.
