A Capital Idea

AI-generated artistic rendition that captures the diverse forms of capital within the Greater Bay Area

Analysis by Leanda Lee*

One of the foundational purposes of the Greater Bay Area is the comprehensive opening of the region: an exciting proposition for asset-rich individuals to invest and contribute to the GBA vision through their activity and engagement. This purpose, however, is presented in the Development Framework in the context of economic development, productivity and industrial innovation.

Terms such as assets, investment and capital commonly conjure ideas of economic and financial activity, but building forms of capital other than the throughput of monetary value is just as critical to the creation of thriving communities: physical capital, social capital, creative capital, environmental capital, educational capital, human capital. Many kinds of value flow from wealth embedded in these forms of capital. In the Development Framework, however, nine of the ten key cooperation areas are market-based or market-enhancing activities and only one refers to other spheres of a prosperous life: to build a quality living circle.

Other forms of capital do not have ready and recognizable metrics associated with them, as is found in the measure of GDP which lends relative superior importance to economic outcomes. Communities recognize that what is measured and what governments, media and common discourse continue to highlight becomes valued over other aspects of human activity. Monetary metrics, however, measure only part of value created when humans prosper and life flourishes on earth.

Bolstering activity in creative domains and educational engagement is still viewed as tangential and peripheral support to the more commonplace business and economic activity. We see the latter being facilitated by trade fairs, missions and Foreign Direct Investment. Areas of development more sensitively determined to be under the purview of sovereign control and not necessarily reliant on external engagement – such as environment, social structure and human development – are cautiously opened to external collaboration and influence by only trusted entities. In one example, it is telling that the ambassador of Monaco to China, Marie-Pascale Boisson is hopeful of “advancing ties and creating exchanges in the fields of environment and culture.” In The Times on Friday, the relationship between China and Monaco was characterized by its comparative strength, familiarity reflected in the similarities between Monaco and Macau, and President Xi Jinping and Prince Albert II’s personal rapport. These elements and more suggest that the strength and close nature of the relationship will open doors and corridors to further engagement, so to build wealth and resources for a thriving GBA in more than just the economic domain.

Recent discussions at the Canton Fair with Premier Li Qiang also suggest that foreign partnerships in social development goals and the move to a green economy are being given airtime alongside matters of trade and economic development.

The recent focus in economic and policy discourse globally on a broader conceptualisation of human activity to include multiple assets, resources and forms of capital has come from the understanding of what it takes for people to thrive in balance. This about meeting the human rights of everyone within the means of our limited and living planet. The “use and throw-away”, polluting form of degenerative economic growth that creates externalities and burdens for governments, communities and the environment to carry, and which has come to characterise economic success is now recognised as undermining our ability to meet the future needs and wants of humanity. We are interconnected, social, interdependent and dependent on the living world: this is why other forms of capital and wealth require development and prioritisation.

As stated in my earlier writings, social capital is critical to the success of GBA integration, partly to assist in knowledge transfer and a unification of peoples. Social capital is the wealth of trust and reciprocity. It underpins community cohesion, the ability for people to depend upon one another and to develop through human interaction. This is based on shared values and resources to achieve common goals. Such community cohesion allows for human needs – for participation, leisure, protection and belonging – to be met even outside the sphere of economic activity. Of course, the development of social capital is culturally bounded and thus opening communities to interaction with others will likely create ruptures if not managed thoughtfully with the input from sociology and community-development experts, and from the communities themselves.

Environmental capital – the maintenance of biodiversity, clean air and water and bio-active soils – as another example, is necessary for human health, both directly and indirectly. We are already seeing a stagnation in improving risk factors for non-communicable diseases in the GBA caused mainly by an aging population and risk-behaviours around alcohol and tobacco use. Fortunately, the GBA is a pioneer in recognising that environment-friendly development will mitigate other forms of stress on health and chronic disease. To gain control over average particulate matter, which in 2022 was six times the WHO standard value, will be almost impossible even with end-of-pipe technologies by 2050. But as they are the cause of premature death and morbidity, and consequently detrimental economic effects, as elucidated in a 2023 academic study on the GBA, other forms of capital will need to be employed together with human capital (skills, knowledge, systems’ innovation) and physical capital (technologies that do not undermine the ability of earth’s system to support human development).

The GBA vision is a complex interaction of systems, each impacting upon the rest and supported by assets, resources and many forms of capital; economic capital being necessary but entirely insufficient. Regardless of whether the ultimate aim of integration is political, economic or social, the various forms of capital cannot be exploited in isolation without accessing the value inherent in them all. Undermining the wealth encapsulated in any particular form will undo the whole.

*Contributing Editor, Scholar