The Creation of a Digital Agency is a top Policy Priority for Prime Minister Yoshihide Suga

However, the protracted distribution of a ¥100,000 handout for each resident amid the coronavirus pandemic and the use of fax, now essentially obsolete in most other nations, for reporting COVID-19 infections have laid bare the government’s delay in taking advantage of digital technology.

Though the country possesses quality communications infrastructures, such as fiber optic and mobile phone networks, these have not been utilized sufficiently, with little emphasis on the convenience of users as the starting point, a situation that digital transformation minister Takuya Hirai repeatedly called “the defeat in the digital war.”

The coronavirus pandemic has provided an unprecedented opportunity for the government to develop its digital strategies, which it had struggled to push through, with numerous failed attempts in the past two decades. Globally, an intensifying competition for national cyberpower is playing out. Japan stands at a crossroads right now and must determine whether it will also suffer a defeat in the competitive global cyberspace.

When we consider using the economy as a weapon to solve geopolitical problems, one of the major strategies is to acquire the latest technology and command control over the international standards for the next generation’s leading industries. Cyberspace has emerged as one of the main battlegrounds for competing powers that fully utilize the support of the private sector.

History shows that the world has always maintained order based on the power balance of nations. Alfred Mahan stressed the importance of sea power in the age of imperialism, while it was nuclear power that swayed the balance during the Cold War. After the Cold War came soft power, touted by Joseph Nye, which emphasizes countries’ cooperation rather than the use of coercion when one country wants to reach a desired outcome.

As the times changed, so did the force that defined the ages. Now national cyberpower has surfaced as a deciding force that will determine the rise and fall of various countries. In the age of geoeconomics, cyberspace has jumped to center stage of the national power game, and that is further intensifying the power game of geoeconomics.

In September, the Harvard Kennedy School’s Belfer Center for Science and International Affairs announced the National Cyber Power Index 2020. The U.S. topped the ranking, followed by China, while Japan was ranked ninth, behind European nations such as the United Kingdom, France and Germany.

China’s Digital Silk Road project is playing an important role in that country’s broader Belt and Road initiative. Under the DSR, $17 billion (¥1.8 trillion) worth of investments have been carried out since 2013 not only on network equipment and infrastructure, such as 5G and fiber optic cables, but also in various sectors, such as data and research facilities, smart cities, large-scale e-commerce and smartphone settlements.

These measures represent a credible international strategy that has allowed China to play a leadership role as a cyber superpower and also lead directly to the growth strategy of Chinese enterprises. Even though the government and companies may not be able to operate as one in Japan as they do in China, as the whole of Japan pushes for digitalization, we will need a clear vision on how it will translate into national power or how Japan will position itself in the international context.

Security in Cyberpower

The National Cyber Power Index research team measured countries’ cyber capabilities in the context of seven national objectives that countries pursue using digital means.

The seven objectives are: Surveilling and Monitoring Domestic Groups; Strengthening and Enhancing National Cyber Defenses; Controlling and Manipulating the Information Environment; Foreign Intelligence Collection for National Security; Commercial Gain or Enhancing Domestic Industry Growth; Destroying or Disabling an Adversary’s Infrastructure and Capabilities; and Defining International Cyber Norms and Technical Standards.

These are all important objectives to allow countries to maintain hegemony over cyberspace. To make substantial progress on the digitalization of the economy and society as well as digital transformation, cybersecurity defense, once everything is connected to the internet, would be essential.

Moreover, cybersecurity nowadays has played a critical role in protecting not only companies and the economy from cyberattacks, but also in ensuring national defense against cyberattacks on important infrastructure. As a result of Russia’s attempts to meddle with the U.S. Presidential election in 2016, cybersecurity has expanded its role to protecting democracy and society.

For Japan, cybersecurity is not somebody else’s business. According to the U.K. Foreign Office, Russian military intelligence attempted to obstruct the Tokyo Olympics, which was scheduled to be held in 2020. The number of cyberattacks has doubled following an increasing shift to telework amid the coronavirus pandemic, while cyberattacks that targeted information on coronavirus vaccine development have been reported recently.

Commanding Role in Cyberspace

In Japan, the Basic Act on Cybersecurity, which passed the Diet in 2014, serves as the foundation for related policies. In 2016, the law was amended to strengthen the function of the National center of Incident readiness and Strategy for Cybersecurity (NISC) at the Cabinet Secretariat and again in 2018 to set up a cybersecurity committee to allow the government and private sector to work together to share information ahead of the Tokyo Olympics and Paralympics.

But Japan fared poorly, especially in intelligence gathering, in the National Cyber Power Index, as it has failed to streamline the law to make reporting of cybersecurity incidents mandatory, or install a system of aggregating information to make appropriate detection, analysis, judgement and responses to cyberthreats.

NISC, which plays a central role in improving the government’s cybersecurity, is only tasked with dealing with the government and government agencies as part of its mission, and is not responsible for ensuring the cybersecurity of society as a whole, leaving the private sector to make voluntary efforts.

Because NISC’s main role is general coordination, it also cannot aggregate information by eliminating the vertically segmented administrative system or issue an alert to the government on its own, even if infrastructure under the jurisdiction of government ministries and agencies was to be hit by a cybersecurity incident.

Unless we eliminate the compartmentalized government structure, not only in administrative service and digitalization but also in cybersecurity, the digital agency’s control tower function will likely be insufficient. A lack of expert personnel in cybersecurity is also a serious issue, as is the overall digital problem. We need to set up a structure through which experts who can communicate with professionals in other countries are nurtured and constantly hired, and new expertise continues to be developed at the organizations.

What is to be called for in the digital agency is the function of a conning tower to improve cybersecurity in the overall society in cooperation with the Self-Defense Forces and the Defense Ministry, which defend against attacks, and the National Policy Agency, which cracks down on cybercrimes.

Global Sphere

To achieve those goals, the first step would be to analyze the factors behind the “defeat in the digital war” and have the government realize digital services that citizens feel are convenient. That’s because we cannot make progress unless the government wins appreciation and trust from its own citizens for administrative services.

But at the same time, we cannot forget the fact that cyberspace is a global sphere. No matter how we push ahead with the digital transformation, it would have to meet the geoeconomic challenge of a cutthroat competition in the global cyberpower game. Sadly, the Japanese government is nowhere near acquiring an integrated core function that would nurture, exercise and defend national cyberpower, the most vital national strength of the 21st century.

Former U.S. President John F. Kennedy once said that “a nation can be no stronger abroad than she is at home,” but we must realize that we cannot put in place cybersecurity that is beyond our national cyberpower.

Author: Jun Mukoyama, Fellow at API. API Geoeconomic Briefing, provided by the Asia Pacific Initiative, an independent think tank based in Tokyo, is a series that looks into geopolitical & economic trends in the post-COVID-19 world, with a particular focus on technology and innovation, global supply chains, international rule-making and climate change.
Editor’s Note: The article reflects the author’s opinion only, and not necessarily the views of the editorial opinion of Belt & Road News.