Governments worldwide are too often playing catch-up against private cyberspace operators in what is poised to become a key arena for defending national interests, the International Institute for Strategic Studies said Tuesday.

And while the US remains the dominant cyberspace power, China is rapidly gaining ground and could soon be a major rival in both the civil and military spheres, the Britain-based research group said after a two-year study.

"All countries are still in the early stages of coming to terms with the strategic implications of cyberspace," the IISS analysts said.

"A sense of crisis and inadequacy is pervasive in political circles, with private actors seemingly saying 'catch me if you can' to governments as they race to maximise immense profits."

Despite the rapid advances in surveillance and intelligence technologies that exploit advanced computing and network capabilities, most governments have yet to establish legal and political frameworks for their use.

"The traditional structures of government, corporate management and social organisation consistently struggle to adapt in a timely fashion," the IISS report said.

It ranked 15 major countries into three groups based on their technological prowess, with the US at the top given its 25 years of experience and investment in cyber-capabilities.

But China is gaining ground after making rapid progress in certain fields, as have Russia, Britain, Israel, Australia, Canada and France.

In a third group are emerging countries such India, Japan, Iran and North Korea, which are still weak in certain areas but with ambitious plans for staking out their patch of the cybersphere.

"China is a second-tier cyber power but, given its growing industrial base in digital technology, it is the state best placed to join the US in the first tier," the analysts said.

"At the heart of the national strategies of the US and China, and the trade war between them, is competition for control over the technologies that physically underpin the future of cyberspace -- such as microchip production, computer assembly, mobile internet (such as 5G), cloud architectures, cables and routers," they said.

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