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China Foreign Tertiary Education Market
China Knowledge Press, July 2003, Pages: 167
With long-term effects, China’s accession to the World Trade Organization (WTO) is part of a lengthy process of ongoing social and economic change. As foreign companies penetrate the market, competition is on the increase in many sectors. The government in its 10th Five-Year Plan stressed the importance of education, but in 2001 government education spending was only RMB82 billion(16% of the total). The people are becoming aware of the need for life-long learning in a complex world,
and demand for higher learning is rising quickly.
With an estimated value of RMB48 billion (US$5 billion) in 20021, China’s higher education market is large and growing. It presents risks and opportunities to investors in an increasingly competitive domestic environment.
Annually China is sending abroad about 76,0522 new selffunded students to overseas universities. One study concluded that “Fast domestic economic growth and a better financial background of Chinese students, together with still unsatisfying domestic higher education, have resulted in the continual increase of students studying abroad.3” This underlines the weakness of the education system while indicating that there are growth areas for potential investment.
In light of the weaknesses in the domestic higher education sector, China Knowledge
Consulting has identified opportunities in two key areas:
-Investment in higher learning and the sub-degree market;
-other countries becoming higher learning destinations.
The sub-degree niche is expanding because of the low levels of local university enrollment
and self-funding overseas. With urban income on the rise, we expect an increase in higher education consumption and expenditure in the coming years. China needs 100,000 new MBA degree holders annually, but is producing only one-tenth of that number. Therefore, educational institute joint ventures and franchises are likely to grow in number to meet the demand for more skilled workers in a freer market. Our survey results showed plenty of scope for investors to be a bridge between Chinese and overseas universities.
We have included here a case study on New Oriental Schools, a successful local educational institute.
This company has synergized its business and corporate strategies to form core competencies, enabling it to get ahead of the competition.
This market research report addresses issues of interest to investors, presents our primary survey and research findings, and includes overviews of legal and tax aspects. A directory of useful contacts appears at the end.
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