Australia and China's higher education revolution

26 Jul 2011

The implications of the changes in the way China educates its people are far-reaching says Philipp Ivanov.

On the eighth of May this year China’s Suzhou University based in the eastern province of Jiangsu announced its plans to open a campus in Laos – the first overseas presence by a Chinese institution, also the first international campus in Laos ( This development was described by some experts as yet another symbol of China’s growing international ambitions and a drive to export its political and economic development model. It also signifies an important milestone in what is sometimes described as the “quiet revolution” that is China’s higher education reform.

The implications of the changes in the way China educates its people are far-reaching, as we try to understand the motives and philosophy behind political, economic and social decisions in that country. As China asserts its global superpower status, witnessed by its increasingly independent economic policy, a revamped and more aggressive security strategy and foreign policy, we need to have a more systematic understanding of how the future elite of Chinese society is and will be educated.

It is also vital for Australia to understand these changes not only because of the breadth, interdependency and complexity of our relations but also because Australia currently educates over 126,000 Chinese students (which constitute 26% of all overseas students in Australia (23)

Indirectly, it makes Australia a stakeholder in Chinese higher education.

Scale and Scope

There has been a lot of sensationalist and alarmist reporting about the scale and implications of China’s education reforms. One example is the frequently-quoted and misinterpreted statement that “China today produces 3 times more engineers than the United States and will quickly overtake the U.S. in total graduates” ( (580)). Why it should alarm anyone who knows the basic population and economic statistics is unclear.

There is nothing unprecedented about China’s strive to develop its higher education system. It is the scale, pace and the current international environment that make these transformations unique.

China officially embarked on the higher education reform in 1998, following the decision to digress from the established norm of focusing on secondary education, and instead concentrate on reforming its university system.

The policy framework for the changes was set in the 10th (2001–05) and the 11th (2006–10) Five-Year Plans. One remarkable economic analysis of the reforms titled “The Higher Educational Transformation of China and Its Global Implications” ( gives us a good look at the scale of these changes.

Since 1998, China managed to increase the number of graduates from under one million in 1998 to over 6 million in 2010. The number of total enrolments in the sector grew even more rapidly and is approximately 5 times larger now than in the late 1990s. The increase is the most notable among science and engineering students which reflects the government agenda of boosting innovation and the supply of highly skilled labour for manufacturing industry.

However, the most important change has occurred in the levels of investment in the sector. Under the ‘985 Project’ (an initiative launched in 1998 to develop a small group of globally competitive institutions - 10 institutions have received the funding of more than 30 billion RMB in 1998 alone ( At the same time, the institutions were given a green light to generate their own income from commercialisation activities, tuition fees and private funds – these 3 categories now account for around 50% of institutional income, with the other half coming from the government.

The investment in R&D is a key component of the sector financing reform. The government is set to achieve its 2010 target of 2% of the gross domestic product allocated to R&D. From 2000 to 2004 the average annual increase in government injections in research was approximately US$1.5 billion (

The large-scale investment in the sector is delivered alongside the sweeping changes in the staff performance system and institutional accountability.

Such a rapid transformation has lifted Chinese universities out of the abyss they were in during and in the decade after the Cultural Revolution. However, the challenges are as formidable as their achievements.

First, the increase in higher education attainment resulted in a sharp rise in income inequality between the educated middle class and the rural and urban poor. This, however, is being quite efficiently tackled by the improved access to higher education for rural students.

Secondly, the quality of education has not kept pace with the increase in class sizes, investment and infrastructure development. The traditional rote learning, teacher-centred system continues to prevail in the majority of Chinese institutions which is often counterproductive to the efforts to encourage critical thinking and creativity.


It is impossible to underestimate the importance of understanding the thinking of the people who set the strategy for educating China’s new elite. In my experience managing China University Presidents Programs at the University of Sydney (a Leadership Development program for senior executives of Chinese universities - I witnessed an amazingly rapid change in leadership thinking, calibre and philosophy of the Chinese higher education leaders. If in 2007 the program cohort consisted mainly of ‘old-school’ vice-presidents interested mostly in financial statistics and regulations at Australian universities, by 2010 we have seen younger, more often overseas-educated academic managers eager to learn about strategic planning and innovative management practices.

Among the top leadership of China’s universities, a ‘culture of humiliation’ described by Linda Jacobson in her talk ‘How China views the World’ at Lowy ( is slowly but steadily giving way to the increased confidence of the achievements and status of Chinese institutions. In the beginning of the 2000s university leaders complained about under resourcing of their institutions and their inferiority to Western schools. In the 10 years since it has been gradually replaced by constructive criticism of the western (in this case Australian) university management models as unsuitable to the Chinese context. They also thought that the financing of our universities and particularly government investment in the sector was inadequate for the country that claims to build a knowledge-based economy. This new assertiveness is not just a product of revived nationalist sentiments in China.

The communist-type compulsory ideological training of higher education cadres did not disappear but was transformed into a business school-oriented model in which all newly appointed university leaders undertake a leadership and strategy development training course at the China National Academy of Education Administration ( (6432)) and the Communist Party schools. The ideological training still forms a part of the curriculum but the bulk of it focuses on organisational and financial management, strategy and the study of global best practices.

However, the significant structural and quality problems in the sector remain. Central planning concentrated in the Ministry of Education still determines the long-term strategy of literally each individual institution including the elite group of the nine most research-intensive universities such as Tsinghua. Although investment in universities has skyrocketed in a relatively short period of time, the strategy behind the allocation of funding is not always consistent. Construction of new facilities and brand-new campuses was done at the expense of investment in staff and students services. The research output has improved significantly but it is still largely confined to the elite research institutions rather than second-tier or local universities. Leadership initiative and autonomy which are encouraged and nurtured by the Central government strategists is often restricted or resisted by lower layers of educational bureaucracy for the sake of compliance.

Despite these issues, the leadership of Chinese universities is changing and we can expect that increased autonomy and therefore a more individual approach to institutional strategies will result in a more diversified and globally-competitive higher education system.

Current and Future Impact

What will these reforms mean for the rest of the world and Australia?

Talent Wars

Most of all, it will mean intensified competition for academic talent and students, in which Australia without adequate and consistent investment in its universities may lose. The arrival of a new large internationally-competitive player in R&D and commercialisation already poses a challenge for China’s western competitors, including Australia. But it will also mean closer and more equal research and teaching collaborations between the Chinese and our universities and a gradual removal of language, bureaucratic and funding barriers. Despite the growth in university places in China, in the foreseeable future, it will not be able to accommodate domestically the growing number of students, particularly post-graduates, and therefore the Chinese will continue to study abroad regardless of the inability to get a place at home or for career and immigration opportunities. Given Australia’s reputation as a quality provider of postgraduate coursework degrees (which are pursued by the majority of Chinese students in Australia), we have a golden opportunity not just to be a part of the higher education changes in China, but also have an advantageous position in the global talent wars.

New Elite?

Secondly, we are likely to see more confident and better educated Chinese graduates entering the global workforce. It is likely that they will have no less nationalistic vigour than the previous generation due to the continuing ideological training and the rise of China as a global power. But this new generation will also be much more international in their outlook and globally mobile which means that we will see even more Chinese professionals in multinational and international businesses, political and academic organizations. Most importantly, the education, economic and social reforms coupled with the generational changes will have a significant (yet still unknown) impact on the philosophy and decision-making patterns of China’s elite.

Implications for Australia

China’s move into the internationalisation and cross-border provision of higher education should not be seen only as a looming threat to Australia’s $15 billion dollar international education industry. China’s Higher Education reform, and particularly its recent internationalisation push, is an opportunity for Australia to capitalise on its existing education supplier status while re-calibrating its education relations with China towards a more comprehensive partnership.

Australia’s 126,000 strong Chinese students’ population is a solid foundation on which to grow our education relations.

One of the main features of China’s higher education reform - a significant increase in the number of graduates will not necessarily mean the decline in the number of Chinese students pursuing overseas education. OECD predicts that by 2025 China’s middle class population will reach 500 million. (58) . A large percentage of this group will seek to enter higher education. Despite the expansion of the higher education sector, insufficient number of university places, particularly in the elite and second-tier institutions coupled with quality issues, and international career and immigration prospects will mean that Chinese students will continue to pursue overseas studies. Our ability to monitor and respond to the changes in demand and local capacity is crucial for maintaining and growing our third largest export industry.

The internationalisation component of China’s higher education reform focuses primarily on the recruitment of international students and staff to China and international research collaborations ( (38)). The move to cross-border education in Laos does not necessarily mean a policy change. It is likely to be a political and commercial venture aimed to strengthen Sino-Laotian relations. However, similarly to the development of Confucius Institutes, it can be used to test the capacity of Chinese institutions (and government) to operate an offshore education enterprise. But given major existing internal problems facing the Chinese higher education sector, particularly in quality, it is improbable that the focus of the reforms will move to building offshore campuses.

What is more certain and more central for Australia is continuous effort to internationalise Chinese universities themselves. To do so will mean, among other adjustments, increasing the number of programs taught in English. Our universities have over 100 joint teaching programs delivered in China which serve as a local provision and capacity development mechanism. Our institutions therefore can be a part of the internationalisation agenda through the existing and new joint education enterprises.

So although the Laotian venture of Suzhou University does not pose an immediate threat to Australia’s competitive position, a failure to understand and engage with China on its education internationalisation strategies may leave us overexposed to rapid policy shifts and their economic consequences.

What is more threatening to our international education industry are complacency and unpreparedness of the government and institutions towards the shifts in policy and student demand from China caused by economic or reputational factors. These coupled with sudden and ill-communicated changes in skilled immigration policies have caused the recent crises in Australia’s international education. Joint Work Plan recently signed between the DEEWR and the Chinese Ministry of Education ( (46)) is a step in the right direction, but both institutions and the government need to do more. Apart from the core element of our education partnership which is students, it should also focus on expansion of the joint teaching and research programs (particularly delivered offshore in China). It will also mean broadening and deepening the leadership and policy exchanges between governments and institutions.

The strength of our international education industry and, given its importance to Australian universities, the health of the sector as a whole will be largely influenced by the interconnectedness of our higher education systems. The transformation of China’s higher education is above all an opportunity for Australia to lift our education engagement towards more sustainable and pro-active education relations.


Philipp Ivanov was recently Acting Deputy Director of the University of Sydney's Research Institute for Asia and the Pacific and he presented a version of this paper at the Lowy Institute for International Policy's New Voices Conference 2011: “Dynamic Asia” on Friday 8 July 2011.


Image: *LJ* / flickr

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