The international mobility of Chinese students is remarkable. The number of students going to foreign education institutions each year can be counted in millions, with China being the biggest country in the world in terms of international students abroad.
For years, the most attractive destinations among Chinese students have been the United States, UK, Australia and Canada.
However, many Chinese students have had to consider twice going abroad because of the health concerns and tightened travel restrictions brought by the COVID-19 pandemic as well as geographical and political tensions between the nations.
Nevertheless, the need for and interest in international education remains high in China. In fact, the ongoing pandemic has highlighted several key educational trends that international education companies could take advantage of in the Chinese education market.
The need for study abroad opportunities are deep-rooted in Chinese students
Despite growing uncertainties, the quantity surveyor (QS) report shows that more than 90 percent of potential Chinese international students prefer to pursue their higher education degree abroad. For those students destined for the United States, newly elected President Joe Biden also offers a little more hope for a positive welcome.
Interest in studying in other Asian countries, including Japan and South Korea, has also grown due to lower costs and cultural similarities.
It is also noticeable that some students seek international education closer to home by turning to Sino-Foreign Cooperative Universities. For example, NYU Shanghai received 14 percent more applications from students living in China before the Ministry of Education (MOE) announced plans to expand its programs to eligible students who are unable to study abroad due to the pandemic.
Online education is an invaluable part of the Chinese education system
The Chinese Ministry of Education has acknowledged that the role of solutions supporting online education in today’s Chinese education system has become increasingly important.
About a month after the outbreak of the COVID-19 pandemic, the MOE created the framework for 37 platforms offering 24,000 free online courses for colleges. K-12 education companies have also focused on providing more e-learning courses and developing tools with which data can be used to analyze student performance and help teachers track student progress in their studies.
Schools in China are now well equipped for both distance and local learning in the event of sporadic COVID-19 outbreaks. The online education sector is expected to triple in 2019 from 203 billion RMB (USD 30.9 billion) to 696 billion RMB (USD 106 billion) by 2023.
Vocational training is experiencing significant growth due to strong government support
To reverse the growing unemployment rates caused by the COVID-19 pandemic, China plans to provide more than 35 million vocational training opportunities and increase the number of vocational college students by about two million over the next two years.
Political interest in investing in high-quality vocational training was already visible before the pandemic to make the working population better prepared to meet the demands of China’s changing economy. In addition to leveraging Western models, the Chinese authorities are also interested in working with developing countries as well as international organizations to share new perspectives on vocational education and training.
What opportunities does China offer for foreign education companies?
Despite a shifting geopolitical landscape, China continues to demonstrate openness toward foreign investment in the domestic education sector.
This was seen most recently in the significantly narrowed negative list for foreign investment, which permits wholly foreign-owned enterprises to establish vocational training institutions in China without a domestic partner.
While the current legal framework still prohibits foreign investment in compulsory education (K1-9), the education sector is showing several promising opportunities for foreign companies:
The Chinese online education market is showing no signs of slowing down
The Chinese online education market has become one of the most profitable markets in the world due to the growing needs of private and vocational education. The market needs are not limited to materials and learning resources but they also reach beyond educational technology capabilities such as virtual learning and online classrooms.
Many Chinese educational institutions are collaborating with international companies providing educational services to build integrated learning services that combine offline and online learning. Nevertheless, international educational stakeholders need to keep in mind the regulatory framework of the Chinese government.
Due to its unique position between two very sensitive sectors, education and the internet, online education providers are constantly under surveillance, especially when services are provided through media such as mobile applications and live streaming platforms.
China’s domestic education market is internationalizing at a rapid pace in terms of education
The pandemic has driven the Chinese government into a situation where it is actively exploring opportunities for internationalization for domestic higher education. In June 2020, the MOE stressed the need to increase Sino-foreign cooperation, reform approval policies for international involvement in educational institutions and attract high-quality international educational resources.
As a result, China is likely to be interested in seeing a growing number of Sino-foreign cooperation projects and institutions nationwide in the future, creating new opportunities for foreign institutions and companies.
Pilot-free business areas are driving the change
Foreign-Trade Zones (FTZ) in Hainan, Shenzhen and the Yangtze River Delta have given a particularly positive reception to foreign investment. These areas have made the internationalization of education one of their key priorities.
The development of Hainan’s Free Trade Port (FTP) is especially notable for proposals to encourage Sino-foreign cooperation in running schools and permitting foreign higher education institutions and vocational schools in science, engineering, agriculture and medicine to establish independent schools on the island.
Building off these Pilots, Hainan is likely to become the first region in China to fully open up to foreign investment in the education sector.
The government’s recent decision to establish three new FTZs in Beijing, Hunan and Anhui provinces may also create opportunities for foreign investment in the education sector.