The Impact of Trade Wars

November 13th, 2018 by

 

The impact of a trade war between the United States and China future international student recruitment and enrollment

 

 

In my book, International Student Mobility and the New World Disorder, I make the claim that future international student mobility will be influenced by economic, political, sociological and technological changes taking place throughout the world. In this section of an updated white paper on my prior book and predictions, I am focusing on the potential impact of a trade war between the United states and China on the future enrollment of Chinese students in the United States.

In 2018 the United States initiated a series of trade wars with both allies and adversaries alike. In Bob Woodward’s book, Fear, the author outlines President Trump’s obsession with the United States’ trade imbalance with China, South Korea, Japan, Canada and Mexico and his desire to terminate past trade agreements and write new ones. The president considers tariffs bargaining chips in rewriting global trading rules and lists as one of his major economic successes the “new” NAFTA trade agreement reached in September 2018 with Canada, Mexico and the United States. Similarly, South Korea gave the president his first big trade deal by agreeing to accept more American imports. Japan is reviewing its trade deficit with the United States and is expected, like South Korea, to import more American products.

This report will focus on the trade war between the United States and China. Geopolitical differences and mutual distrust have been a cornerstone in American and Chinese relations for years.  In August 2018, the president instructed his trade team to consider imposing 25 percent tariffs on $200 billion of Chinese exports. Additional tariffs were announced in September, making the total number of Chinese goods affected by the tariffs $250 billion. China’s retaliation, also announced in August, was to impose tariffs of $60 billion on American imports.

In September 2018 the president accused the Chinese government of attempting to influence the November midterm elections by identifying the American states, in the south, Midwest and northeast that would be the most negatively impacted by Chinese tariffs. Almonds from California, steel from Pennsylvania, car parts from Michigan and soybeans from Iowa are the states most likely affected by Chinese tariffs.

The president’s imposition of tariffs on a number of Chinese exports has raised the level of tension and rivalry between the two countries. Richard Haas, president of the Council on Foreign Relations, remarked on October 2, 2018 that the current state of U.S./China relations is a “new cold war.”

Since the imposition of tariffs Chinese stocks have fallen sharply.  In September 2018, the stock market was down almost a quarter from its peak in January 2018. The Economist reports that since April the yuan is down 8 percent and there was a current-account deficit in the first half of 2018, China’s first such gap in two decades.

Like the United States, China is seeking other trading partners, including Russia, certain European countries, the countries in its “Belt and Road” project and the countries in the new Trans-Pacific partnership to increase trade. Zhiwu Chen, director of the Asia Global Institute at the University of Hong Kong, predicts the emergence of “different trade blocks based on geography and values.”

Global trade, like global student mobility, has been shifting eastwards and southwards for some time. Still there are more Chinese students studying on American colleges and universities campuses than from any other country. Trade tensions between China and the United States could easily spill over into future international recruitment of Chinese students. Many colleges and universities in the United states are heavily dependent on the revenue from Chinese students to meet both enrollment and financial goals. The Chinese government could impose a limit on the number of students it allows to enroll on American college campuses. This is not as farfetched as it may first appear. I was a young admission officer at Georgetown University in Washington, DC when the Iranian revolution resulted in all of the enrolled Iranian students ordered home immediately. This summer the government of Saudi Arabia recalled all of its students studying in Canada because of a statement made by a Canadian government official that was offensive to the Saudi government. I realize I am citing political events that resulted in shifting international student mobility enrollment. But I believe that economic events, like a trade war between the United States and China, could also result in fewer Chinese students studying on American college campuses. Do many American schools have a plan B should this happen?

Jack Ma, founder of Ali Baba, predicts that a trade war between the United States and China, will last two decades. A sobering prediction.

 

Africa: The Next International Student Recruitment Frontier

October 30th, 2018 by

 Africa: The Next International Student Recruitment Frontier   

For ten years I helped to manage a university in Dakar, Senegal.  One day, in the breakfast room of my hotel, I noticed that I was the only person having breakfast who was not Chinese.  China has made a huge investment in Africa and other countries are doing the same. There are several reasons why I believe that Africa will be the next area of the world to support international student recruitment.  

Consider the following:

Six of the world’s fastest-growing economies between 2001 and 2012 were in Africa.

Goldman Sachs recently issued a report, “Africa’s Turn,” comparing business opportunities in Africa with those of China in the early 1990s.

Google is the single biggest private sector influence in Africa.  Its internet search and email services are transforming the continent.  The company is also attempting to help African governments digitize information and make it freely available and is improving translation software to bring more Africans who speak only one language online.   

Online Africa is developing faster than offline Africa.  According to the May 12th issue of “The Economist,” undersea cables reaching Africa on the Atlantic and Indian Ocean coasts, plus innovative mobile phone providers, have raised internet speeds and slashed prices.  This connectivity is making Africa faster and more transparent in almost everything it does.

China will implement the African Talents Program to train 30,000 personnel, offer 18,000 government scholarships and build cultural and vocational training facilities.  China will also continue to implement the China-Africa Joint Research and Exchange Plan to sponsor 100 programs for research, exchange and cooperation between colleges and universities and research scholars.

On July 17, 2012, Australia launched an expanded Australia-Africa Universities Network, a consortium of 17 Australian universities and research institutes and 30 African institutions.

Colleges and universities around the world should consider developing African recruitment strategies and begin to consider building strategic academic and research alliances.  To ignore the potential of African student, faculty and administrator exchange programs is to limit a school’s ability to become a player in the next international “hotspot.”

                        

Alternative international higher education myths

October 2nd, 2018 by

Alternative international higher education myths

At the risk of being accused of being politically correct (or incorrect), I would like to share with you some of the international higher education myths I have uncovered over the past few months.

 

Myth

The U.S. continues leads the world in attracting international students.

Fact

Last year, the U.S. had a 10 percent increase in international students. But Canada increased its international student population by 13 percent, and Australia and New Zealand increased the number of students studying on its campuses by 12 percent.

Myth

The demand for higher education is greatest in Europe.

Fact

The demand for higher education in South Asia is exploding. With a population of more than 600 million under the age of 18, and with the rapid pace of social and economic changes taking place in the region, South Asia is poised to take over Western Europe and the U.S. as a primary choice for enrollment. This fact may not be reflected in next year’s enrollment statistics, but this is a trend that I would watch closely for future recruitment threats and opportunities.

Myth

International hubs and branch campuses will continue to increase in the future.

Fact

International hubs may increase in the future but I predict regional hubs, rather than international hubs, will grow faster.

Myth

The Asian middle class has grown faster than any other region in the world.

Fact

The Asian middle class has increased in numbers over the past two decades but the African middle class has tripled over the past 14 years from 4.6 million households in 2000 to 15 million in 2016.

Myth

The UK continues to be the number one choice for U.S. students studying abroad.

Fact

The fastest growing market for U.S. students is Germany. The number of U.S. students studying in Germany is estimated to be 10,000. Most of the students pay no tuition.

Myth

The fastest growing Chinese market will be at the graduate and undergraduate level.

Fact

Chinese teenagers, as young as 14, are enrolling in high schools throughout the world in increasing numbers. Last year, for example, the number of Chinese high school students was nearly 50,000. This is 100 times more than in 2004.

These are but a few of the myths and facts in international higher education. More to come in the future.

International Student Mobility and the New World Disorder

September 18th, 2018 by

International Student Mobility and the New World Disorder

It is perhaps both risky and foolish to predict future international student recruitment patterns and trends. Fast-moving political, economic, and technological worldwide developments make it impossible to predict with certainty the impact of these developments on higher education and future international recruitment and enrollment.

However, I do think it is important to recognize that world events have had, and will continue to have, an impact on future generations of international students. The destinations of future foreign students cannot be isolated from changing worldwide geopolitical and economic realities. There are messages for international enrollment managers and deans on the front pages of our newspapers today.

Few would argue that 2017 was a year of worldwide change and disruption. Players in the geopolitical chess game seem to be constantly changing, creating new alliances – political, economic and societal.

In his recent book, A World in Disarray, Richard Haass, President of the Council on Foreign Relations, quotes a former United States director of national intelligence, who wrote: “Emerging trends suggest that geopolitical competition among major powers is increasing in ways that challenge international norms.” Disruption on the world stage.

Rob Brown of the global education group Navitas, in addressing a conference in September, 2016, wrote “Disruption will happen in higher education like nothing we have seen before and first world institutions are going to suffer the hardest. The real opportunities exist in the developing world.” Disruption on the international higher education stage.

In the Price Waterhouse Coopers report, The World in 2050: Will the shift in global power continue?, the authors estimate that in just a few decades, the world will be very different from what it is today in terms of global ranking of national economies and the major drivers of economic growth. The report notes that China overtook the United States in 2014 to become the world’s largest economy on purchasing power parity and by 2028 the authors project that China will surpass the United States’ GDP in market exchange rate terms.

Countries with the fastest growing economies, populations and growing middle classes in Asia, like Indonesia, Malaysia, Thailand and Vietnam will dominate economic growth in the region. The Asian middle class is expected to increase from 600 million in 2010 to more than 3 billion by 2030 to represent 66 percent of total global middle class population.

International student mobility, by extension, will be impacted by this new economic reality. I think it is safe to predict that regional mobility will grow in importance and the major importers of student today, the United States and the United Kingdom, will continue to lose their share of internationally mobile students. While China will remain a leading exporter of students, it will increasingly become a major importer of students with a goal of enrolling 500,000 international students by 2020.

According to an Organization for Economic Cooperation and Development report, the stage is set for a new level of competition among international study destinations. National visa and immigration policies, coordinated regional and national marketing campaigns, and the availability of scholarships and employment after graduation will be some of the factors countries can leverage to increase their market share of international students.

Demographic and income growth and expansion of the middle class will set the dial for future international student mobility. As long as the middle class continues to grow across the globe, demand for postsecondary education will continue to outpace supply.

The impact of populism on international student mobility cannot be underestimated and has already been realized in the United States and in Britain. Enrollment statistics for the fall, 2017 term for both countries revealed changes and in certain cohorts, declines in the number of international students.

In contrast, the governments of Malaysia, Indonesia, Thailand, Taiwan, Vietnam and Singapore have made education a priority and have invested heavily in the sector. The result has been the creation of a political and economic “infrastructure” in those countries that supports higher education enrollments and academic and research collaborations.

There will probably be no greater impact on worldwide higher education than the integration of technology into education delivery methods. The internet has rendered geography irrelevant and digital options, especially in India and in some African countries, are changing the way higher education is consumed in those countries. The numbers are staggering and change daily, but according to the report, Digital Learning Compass: Distance Education Enrollment Report 2017, 30 percent of students worldwide are enrolled in at least one online course.

The jury is still out on the potential and sustainability of online education. But the major MOOC providers, Udacity, Coursera, edX in the United States, FutrureLearn in Britain and Iversity in Germany, among others, believe that MOOCs have the potential to educate millions of students, democratize higher education and build global communities.

I believe that the greatest promises of online learning and MOOCs, as well as the greatest threats, have yet to materialize.

The intersection of disruption with unpredictability demands a new way of thinking and planning. Successful international student recruitment and enrollment in the future will require international deans and recruiters who are both curious and courageous and engage in what Amit Mrig, the President of Academic Impressions, calls “horizon thinking.”

No one has a crystal ball. No one knows for certain how international higher education will evolve over the next year and in future years. The only thing we know for sure is that change will be our constant companion and political, economic and technological trends have, and will continue to have, an impact on where students enroll and why they select one country over another.

Seth Odell, a higher education writer, wrote: “The safe creative seldom achieves the momentum” Successfully embracing and managing change will be the currency of successful schools in the future.

The world is changing. And there are some segments of international higher education plans that are not changing fast enough to meet the headwinds of change.

We can either succumb to change or manage it. The choice is ours.

 

 

China and the New World Order

September 4th, 2018 by

 

China and the new world order

 

 

Premise:

The worldwide political changes of 2017 will benefit China by increasing its political and economic influence in Asia and around the world. China’s new dominance and strategic alliances will influence the future of international student mobility.

It would be easy to focus an article about the impressive rise of China’s higher education system and the impact of Chinese students on international mobility patterns.

The nu

mbers are dazzling.

In 2017 more than 700,000 Chinese students studied abroad, some in high schools and colleges, others for a shorter period of time, perhaps for language study. According to an April 22, 2017 article in “The Economist,” 57 per cent of Chinese parents would like to send their children abroad for study.

But this is not an article about increasing Chinese student numbers. This article is an attempt to see to tomorrow and how China may and can emerge as a higher education superpower in the coming years.

The

U.S. columnist Ian Bremer predicts that American international leadership, a constant since 1945, will end this year. The U.S. has become the single biggest source of international uncertainty, creating a void that China is eager to fill.

Xi Jingping, China’s most powerful leader since Deng Xiaoping, has been called the chairman of everything. His policies have ushered in a new territorial assertiveness as evidenced by recent events. The fawning reception given him at the January, 2017 World Economic Forum in Davos signaled the importance of the Chinese president on the world stage. And the chairman did not disappoint. He presented himself and his country as champions for globalization and open markets and he suggested that China should guide economic globalization in the future. Mr. Xi’s frequently refers to the “Chinese dre

am of the great revival of the Chinese nation.”

Contrast these sentiments with the inward-looking policies of the U.S. and it is easy to understand why Xi’s comments were not lost on the attendees of the World Economic Forum. Nor were they lost on the countries in Asia and Southeast Asia, such as Thailand, the Philippines and Malaysia.

In May, 2017 the first Belt and Road Forum was held in Beijing. This initiative will spend $150 billion in infrastructure projects in countries south and west of China, along the historic Silk Road. The overarching aim of the project is to construct a network of ports, railways and pipelines that will plug China into economic hubs across Asia, the Middle East, Africa and Europe.

The founding

of the Asian Universities Alliance, with an initial membership of 15 universities from across the region, has initial funding of $1.5 million from Tsinghua University and is an example of China flexing its higher education muscles.

Joining Tsinghua University are several academic powerhouses in the region, including Peking University, the University of Tokyo, Seoul National University, the National University of Singapore and the University of Malaysia.

In addition to promoting student and faculty mobility within Asia, the organization also aims to promote collaborative research among member institutions. Chinese Vice-Premier Liu Yandong delivered the keynote address at the opening ceremony and predicte

d that the Asian Universities Alliance will “Resolve regional and global problems and bring together outstanding talents with an international perspective to serve regional development.”

According to Yoichi Funabashi, chairman of the Tokyo-based think tank, Rebuild Japan Initiative Foundation, China can and will use its economic pull to draw Asian nations into its geopolitical orbit. Inevitably, political and economic ties eventually translate into educational ties.

Joseph Nye, who coined the term “soft power” in 1990, certainly would agree that China’s initi

atives are good examples of making “soft power” investments that have the potential to directly impact the political and economic future of the region.

What does this mean for the future of international student enrollment in the United States? It is my opinion that if, and when, United States’ policies change, it will still take a long time to untangle current perceptions and realities. International deans and recruiters will have to accept the reality of the increasing importance of China’s educational prowess and adjust future strategic plans accordingly.

There wi

ll be opportunities for American colleges and universities in the new world order. But these opportunities will demand a different way of recruiting from today’s standard procedures. International deans and recruiters will have to think differently and will have to focus more on collaboration and less on the go-it-alone strategies many schools use today.

Strategic plans written last year or this year, should be scrapped in full or in part. New plans should be written taking into account that what was once certain with regard to international student mobility patterns, are now uncertain.

Beyond the corridors of today lies a new world order.