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Foreign Participation in Higher Education in the People's Republic of China: Challenges and Opportunities

by Walter Hutchens
Early alpha-stage DRAFT, as 2006-11-21

Comments welcome, either via email or on this forum. Please cite or forward only with attribution and acknowledgment of draft status.

Foreign higher education programs are proliferating in China.1 Indeed, it is already possible for a PRC citizen to obtain a BA, MS, MBA and LLM from a US or European university without ever leaving China.2

Moreover, no matter what one might think of its normative merit, China's rising influence is a fact. China exerts increasing global influence over, inter alia, economic, environmental, political, military, scientific and cultural matters. With birthrates declining in much of the affluent world, China's teeming and increasingly affluent masses may be attractive to administrators faced with declining enrollments. Others will see involvement with China as an opportunity to learn about, if not participate more directly in shaping, mega-trends of our time. Others will go to teach, seeing expansion in China as aligned with institutional missions about propagating knowledge. Still others will be drawn to China's enormous research potential, both as a place teeming with endless phenomena worthy of study and as a place where one might collaborate with world-class students and faculty on cutting-edge issues. For all these reasons, it seems virtually certain waves of educators, like entrepreneurs in other areas before them, will continue to find China an attractive place to expand their operations.3

While the opportunities are indeed mesmerizing, foreign institutions that seek to offer higher education programs within China are also likely to confront many vexing challenges. In this article I identify and analyze key ones, surfacing issues that educational leaders might otherwise fail to examine ex ante. I also identify the key legal enactments governing this area, including some rules not heretofore translated into English. I argue that China's approach to the regulation of foreign participation in its higher education sector is reflective of an overall allow-but-control approach taken throughout the PRC's reform era; however, given special characteristics of education and political intransigence in China, I predict this area will be slower to formally liberalize than many other sectors. Finally, I argue that China's rules on foreign involvement in higher education clearly violate the explicit terms of China's WTO accession.

Critical challenges arise in four broad areas when foreign institutions seek to operate higher education programs in China:

  1. Hyper Competitive Market.
  2. This is not a "hang your shingle and they will come" market. There is competition from local institutions and other foreign players. The market for foreign education is not as massive as the population, particularly if you 1) teach in English and 2) need to charge a lot. Note that much of China's economic success has come from exports--using low-cost Chinese labor to make products for sale in higher-income countries. Selling foreign educational services in China actually contemplates reversing that, taking wages set in high-income contexts to deliver programs in China where incomes to support tuition are, on average, much lower, even in white collar circles. Also note your competitors at home may not be your competitors in China; some institutions not regarded as peers in your home market may eat your lunch here.

  3. Regulatory Hurdles.
  4. Foreign participation in higher education in China is subject to a number of legal and regulatory controls that are radically different from those typical of liberal democratic jurisdictions, particularly places where higher education is highly decentralized and fragmented like the US. In the U.S. non-profit accrediting agencies and, for funding, government bureaucracies have enormous impact on higher education. However, in the US you don't need government permission to found a university, nor does the state generally have the overt right to dictate what programs can be offered, what number of students can be admitted and what specific content can be taught. Things are quite different in China.

  5. Partner Relations.
  6. Chinese law requires foreign higher ed institutions to have a Chinese partner to operate within the country. Joint ventures are notoriously difficult. Most foreign investors prefer wholly foreign owned enterprises (WOFEs), but they are not permitted in all sectors. Education is one of those sectors. Having a partner can be quite helpful, particularly at the inception of a program when the foreign player is less familiar with China, but even in the happiest of joint ventures, having a partner introduces burdens of coordination. Quite often, the Chinese phrase "same bed, different dreams" (tong chuang, yi meng), describes educational joint ventures. Conflicts over admissions standards, curriculum, physical facilities, teaching materials, tuition, marketing and other matters may arise. Often, foreign educational administrators do not contemplate these matters when setting up partnerships (or seek the advice of counsel to help draft a thorough agreement).

  7. Home Institution Support.
  8. This one is likely to blindside people. What are you doing training the Chinese to "steal US jobs" anyway? If the program is going to require a start-up investment or perhaps even long-term subsidy, why are you taxing US tuition payers/donors to help Chinese students? Even if you have a compelling answers to these questions and get full authorization from your dean/provost/president/trustees/faculty to do a program in China, is your institution really ready? How are they going to treat three-year degrees (zhuan ke). In China access to higher ed has historically been extremely limited, so holders of a PRC "associates" degree are not the equivalent of holders of an "associates" credential abroad. Will your graduate school consider that when reviewing applications? What will your accounting staff do with an expense reimbursement request with Chinese receipts? Can they hire (and pay) staff overseas (or will your payroll people try to impose US withholding?)? Can your wire money to China? What if the university doesn't have a PRC bank account in its own name? Where is your charter or something equivalent to a "certificate of incorporation"--you may need it for the program application. If you don't have a needed official document, will people be responsive in getting it to you? Can your in-house counsel's office review a contract in Chinese or let you hire someone who can? Besides these technical issues, will the faculty support the program for the longer term? Lots of them will be happy to teach in China once or twice---they'd like to see the Great Wall and Forbidden City, after all. But what about the fourth, fifth and sixth trip? Will faculty fatigue set in? It's a 12 hour flight or more each way. Chinese cities are polluted. The water isn't potable.

  9. Political and Philosophical Differences
  10. China has changed enormously over recent decades. Most commentators commend China for spectacular progress, particularly in terms of poverty reduction. 4 Generally, political reform has moved at a much more retarded pace than economic reform. However, relative to the horrors of the Cultural Revolution and other periods of PRC history, there has been considerable progress even in terms of the openness of academic discourse in China. Scholars now generally speak freely; it's ok to criticize the government, sometimes even in print (at least concerning certain matters and to a certain degree). But China remains a one-party State. The press is not free. People still sometimes get sent to jail for exercising what would be regarded as fundamental human rights in most democracies. There are people in China in jail for organizing labor unions, trying to create alternative political parties and posting unauthorized political material online. The state doesn't fundamentally subscribe to precepts like "academic freedom," a sacrosanct, cherished ideal in the West (and other places). These political and philosophical differences may never cause real frictions in practice. But they might. Can you teach biology in China without talking about politics (information transparency and SARS?)? Can you teach business without talking about politics (corruption as a function of one-party rule, weak courts as a reason for the reliance on guanxi and government relations?)? In journalism, political science and law the flash points are easier to see. Can you have a classroom debate on the Taiwan question? The number of people who died in the Great Leap Forward? Whether it makes sense to still hate the Japanese? Whether Tibet and Xinjiang should be autonomous? Can you use as a textbook something that is banned in China? What's your institution's bottom line? I think you shouldn't go in unless you are ready to get out when push comes to shove, and maybe part of the reason to go in the first place is, if not to shove, at least to nudge.

And, yes, my employer has struggled in all these areas.5

Key Legal Enactments--click here for list, more analysis be added here

1. For a list of currently-approved programs, see 授予国外学位与香港特别行政区学位的合作办学在办项目名单 (截止2004年6月30日)[Shouyu guowai xuewei yu xianggang tebie xingzheng qu xuewei de hezuo banxue zai ban xiangmu ming dan (jiezhi 2004 nian 6 yue 30 ri) [ List of Current Programs Conferring Foreign and Hong Kong Special Administrartive Region Degrees (as of June 20, 2005)], PRC Ministry of Education, available here. Though dated, this is the most current list publicly available. A number of programs have been approved since publication of this list.

I define "foreign higher education programs" as post-secondary educational programs that involve substantial participation from a non-PRC institution. These programs may lead to the awarding of foreign degrees, but that is not a definitional requirement. For example, Johns Hopkins has for more than twenty years run a program with Nanjing University. Until 2006, this program awarded only a certificate. Now students may be admitted to a program leading to a master's degree from SAIS, with all the requirements fulfillable in Nanjing.

Even under the rubric of foreign degree programs, there is wide variance in the degree of participation of primarily foreign-resident faculty. Some programs rely almost exclusively on flown-in faculty. Many others draw instructors from both the foreign institution and the faculty of the PRC partner institution. Some rely mainly on instructors hired locally, even though they market their programs as being distinctively "foreign."

Note that for purposes of this discussion, "foreign educational institutions" includes institutions form Hong Kong, Taiwan and Macau. PRC laws and regulations that govern "foreign" education are, by their own explicit terms, applied to educational institutions from these areas.

Defining "the other," often as a threat, is of course a rich tradition in China and elsewhere. See, Said's Orientalism and recent counter-argument. See also China's tradition of "barbarian management" and US "yellow peril" screeds. [return to main text]

2. BAs are obtainable from the China programs of Nottingham University in Ningbo or the University of Colorado in Beijing, or through online programs of Fort Hayes State University.

An MS in Criminal Justice is available from the University of Maryland in Nanjing, and Johns Hopkins offers an MS in international relations in Nanjing.

MBAs are perhaps the most commonly available foreign degree. Choices include the China programs of Washington University in St. Louis in Shanghai; or from INSEAD, Rutgers, Fordham and the University of Maryland (my present employer) in Beijing.

Temple University School of Law offers an LLM in Beijing [return to main text]

3. The reasons for contemplating expansion in China may be as varied as higher education institutions and the individuals within them. In any given instance, some or all these motives identified may play a role. [return to main text]
4. But see, [commentary on environmental degradation, collapse of rural health system, growing Genii coefficient, return of prostitution and change in status of women]. [return to main text]
5. The business school of the University of Maryland, where I currently teach, has been developing executive MBA programs in China since 2002. Programs are currently offered in Beijing, Shanghai and Tianjin. Two cohorts of EMBA students have already graduated in China. I have taught in these programs and served as an advisor to the administrative staff in charge of these efforts. [return to main text]