Governing Cross-Border Higher Education

Christopher Ziguras, Grant McBurnie

• Publisher: Routledge
• Year: 2014
• eBook ISBN: 9781317653004
• Edition: 1
• Topic: Education
• Subtopic: Education General

Governing Cross-Border Higher Education examines the role of governments in relation to three key aspects of international education: student mobility; migration of international students; and transnational provision through collaboration or branch campuses. The research for this book is informed by interviews with key stakeholders in ten countries and extensive engagement with policy makers and international agencies. It analyses the ways in which governments are able to direct or at least influence these cross-border movements in higher education.

The book explores key issues that national governments are invariably required to contend with in an increasingly globalised higher education market, as well as the policy options available to them in such a climate. Alongside this, there is analysis into why states adopt particular approaches, with critical assessment of their varying success. Key topics include:

• the political economy of international higher education
• recruiting students
• promoting and regulating transnational provision
• student migration
• governing educational imports
• managing the outflow of students
• the regulated market

This book will be a valuable and insightful resource for those involved in higher education policy and interested in the globalisation of the higher education market.

1 Global policy prescriptions

Trade, protection and competitiveness

Christopher Ziguras and Grant McBurnie

DOI: 10.4324/9781315764016-1

Most of this book focuses on the actions taken by national or subnational governments in relation to education provided across their borders, and across the next six chapters we examine the wide range of ways in which they can shape cross-border movements and the varied reasons they might have for doing so. First, though, we will consider three prevailing ideological positions that exercise considerable influence on the thinking of governments around the world. We are interested in the ways in which these bodies of thought impact upon regulatory practice, and we do not intend to examine each as a political philosophy as there has been much already written on the broader political responses to globalization.

We consider three contemporary political positions that have been influential over the past decade, but which of course have much deeper historical roots. The first is the liberal commitment to free trade in education, by limiting state-imposed restrictions on the cross-border activities of students and education providers. We do not use the term ‘neoliberal’ in this book as the term is commonly used to describe a much broader group of political views than we are concerned with here. The second broadly Left political grouping we consider is concerned not with the freedom of the mobile but in protecting the vulnerable from the negative consequences of educational mobility, such as brain drain, increasing inequality in access, and exploitation of students. The third view we consider is a more centrist and pragmatic position that encourages governments to play an active role in regulating cross-border mobility in order to assist in social and economic development.

The dream of open education markets

Economic liberals dream of an open global market for goods and services, and education is no exception. Advocates of free trade in education encourage governments not to place any restrictions on the free flow of students and providers across their borders, and to treat foreign providers the same as domestic providers. As we will see in the chapters that follow, there are fewer obvious barriers to student mobility so most of those advocating for governments to liberalize trade in education services since the mid-1990s have focused on the regulation of transnational providers, arguing that regulation and quality assurance should be transparent and applied fairly to all providers regardless of nationality. In relation to student migration, liberals focus on the outcomes for the individual, asserting the rights of graduates to choose to live and work in the place that suits them, although migration has been a less contentious issue in the past decade than it had been earlier, as we will see in Chapters 4 and 5.

Bashir (2007), in a report for the World Bank, has usefully distinguished between international trade in education (the purchase of education services from a foreign country using domestic resources) and international aid (where the provision of services is financed by the providing country or a multilateral aid agency), estimating that the value of trade in higher education exceeds the value of aid in higher education tenfold (p. 9). The ease with which students and education providers can cross borders is celebrated by market liberals. The growth in student mobility can be seen as a response to market forces, in the sense that unmet demand for education in one place leads students to study elsewhere where the supply is greater. Likewise, the establishment of transnational programmes and campuses can be seen as an alternative means of responding to unmet student demand in other countries, thereby assisting in building educational capacity where the demand exists.

What, then, are trade agreements and what is their effect? Trade agreements are formal contracts between governments setting out the rules and conditions under which trade will be conducted between the signatory parties. Interestingly, the legalization, or codification, of trade in education through the General Agreement on Trade in Services (GATS) and other trade agreements has elicited much greater opposition than the growth of commercial international education ever did. These agreements can be multilateral (such as the GATS, which is administered by the World Trade Organization (WTO)), regional (such as Mercosur in South America) or bilateral (such as the Singapore–New Zealand Free Trade Agreement).

All trade agreements apply the principles of market access and national treatment to trade in services, and to illustrate what these mean in relation to transnational education we will consider the GATS, which is an extensive multilateral agreement binding all of the WTO’s 159 member countries. Each WTO member country voluntarily commits to uphold these principles in relation to particular services. Relatively few countries have made commitments applying to education services, while most have made commitments on financial services and telecommunications where cross-border trade is more extensive.

Unrestricted market access in education services exists when foreign services and service providers are not subject to any quantitative limitations, limitations on forms of legal entity under which educational institutions may be established, or limitations on foreign equity participation. A commitment to national treatment binds governments to ‘accord to services and service suppliers of any other Member, in respect of all measures affecting the supply of services, treatment no less favourable than that it accords to its own like services and service suppliers’ except where conditions and qualifications are specified in the schedule of commitments (WTO, 1995). Whether foreign services and service providers are subject to ‘formally identical treatment or formally different treatment’, they must not be treated in such a way as to modify the conditions of competition in favour of domestic providers. This means that foreign education providers may be subject to different requirements than domestic providers but the effect must not be to disadvantage foreign providers over their domestic competitors. In the GATS, education services are distinguished according to level (primary, secondary, higher, adult and other), and governments choose which of these to commit to liberalizing, if any. Like all services, education is also classified according to the ‘mode of supply’, which relates to the location of the supplier and consumer of the service.

Mode 1, cross-border supply, refers to the supply of a service ‘from the territory of one Member into the territory of any other Member’ (WTO, 1995). In education this mode includes transnational ‘distance’, ‘correspondence’ or ‘online’ education in which an educational institution from one country is teaching a student who is resident in another country, where teachers and students remain in their own countries and communicate through post, fax, the Internet, etc. Mode 2, consumption abroad, refers to the supply of a service ‘in the territory of one Member to the service consumer of any other Member.’ This relates to students travelling abroad to study in another country. This is the only mode of supply that does not impact upon transnational education. Mode 3, commercial presence, refers to the supply of a service ‘by a service supplier of one Member, through commercial presence in the territory of any other Member.’ This relates to the establishment of branch campuses of foreign educational institutions (WTO, 1995 Article I). Mode 4, presence of natural persons, involves provision of a service ‘by a service supplier of one Member, through presence of natural persons of a Member in the territory of any other Member’. In education, this refers to teachers, academics, administrators or marketing staff travelling across national borders to provide educational services (including the administration and marketing thereof) in the student’s home country. Short courses may be provided purely through the presence of natural persons, but in most cases the movement of natural persons in education is used to complement cross-border supply and/or commercial presence. The distinctions between these modes of supply matter when governments commit to liberalizing some forms but not others. In practice, the implications of commitments to free trade in education are complex and subject to legal interpretation in each country, given the range of regulatory frameworks and types of institutions involved.

Further complicating the impact of trade agreements, is the fact that most countries are in practice much more open to foreign education providers than they commit to being under international treaties. Since the early 1990s, many countries have embarked on ‘unilateral’ liberalization, meaning that they have opened their systems to private and foreign providers unilaterally and voluntarily, often without binding it in an international agreement. For example, Malaysia is very open to foreign programmes and has been actively recruiting branch campuses for a decade, but it has not ‘bound’ this open approach legally by enshrining it through the GATS or any bilateral free trade agreements. This means that Malaysia retains the option of closing off some of the rights of foreign providers in the future. When countries make commitments within a trade agreements they very rarely commit to a level of openness that was not already in place. So rather than trade agreements prising open markets and thereby growing the volume of transnational education provision, they instead provide greater certainty to educational institutions that the regulatory environment will not become significantly less open in the future. In this way, trade agreements decrease the level of risk faced by institutions operating transnationally, but they have done little on their own to change governments’ policies.

The liberalization agenda was pushed in the stalled Doha Development Round of WTO talks, which commenced in 2001, by the United States, Australia and New Zealand. Each country tabled negotiating proposals to the WTO, and interestingly each in a similar manner reaffirmed the crucial role that the public sector plays and called for greater market access for foreign institutions operating in the private sector (WTO, 2000, 2001a, 2001b). Within the United States, it should be noted, most of the educational establishment are uninterested or opposed to trade liberalization, and the liberalization agenda is being driven by for-profit education providers, the testing industry, and the Department of Commerce (Vlk, 2006). Britain, which is also a major exporter, is constrained in its advocacy for trade liberalization by its membership of the European Union. While flows of students and institutions have been liberalized extensively within the EU, externally the UK is represented by Brussels, which is ambivalent on educational trade matters due to the diversity of views among the EU membership.

While some advocates, usually economists, point to generic benefits of market liberalization while providing little or no detail about education in particular (e.g. LaRocque, 2003), most proponents cite a wide range of educational gains. Australia’s negotiating position statement to the WTO, for example, argues that liberalizing trade in education services will promote the broader social, cultural and academic benefits of international education. Australia argues that:

the liberalisation of trade in education services [is] the most effective way of encouraging the internationalisation of education and enhancing flows of students between countries. The long-term benefits accruing from internationalising education include:

• fostering a knowledge and appreciation of other languages, cultures and societies. The skills and knowledge that are acquired will benefit students both professionally and culturally;
• facilitating an exchange of people, ideas and experiences. These exchanges add a richness of diversity at the national and international levels, as well as contributing to the international cross-fertilisation of academic knowledge;
• networking relationships among individuals, groups and institutions which can facilitate future economic, political and socio-cultural alliances.

These significant benefits underpin the desirability of facilitating greater cross-border flows of students as well as educational services providers.

(WTO, 2001a)

Perhaps the most prevalent argument put forward in favour of trade liberalization is that allowing students to access foreign education can increase the overall scale of provision where there are supply shortages, usually due to a combination of rapid growth in demand coupled with an inability of the domestic sector to respond. Knight (2002) notes that while the rationales for liberalization put forward by the United States, Australia and New Zealand varied slightly between the three countries, all three focused on the aggregate economic benefits (primarily improved competitiveness) resulting from greater integration into to the global knowledge economy. Of the intergovernmental institutions, the OECD has most emphasized the ways in which cross-border higher education can contribute to capacity building in low- and middle-income countries, and the Australian government worked closely with the OECD during the early 2000s to promote such benefits through publications and events (Vincent-Lancrin, 2007; Ziguras, Reinke & McBurnie, 2003). The exporters at each opportunity have explained to the importing nations that freeing up transnational education will expand access to foreign education to a wider range of students, as the United States Trade Representative explained in 2003:

Each year, thousands of students travel to the United States to study. They take home knowledge of engineering, science, mathematics, management, medicine, economics, and other disciplines essential to their country’s development – as well as some experience in democracy … . Traveling to the United States, however, is far beyond the reach of most people in developing countries. Education and training could be provided at lower cost in the countries where they are needed. Yet many countries continue to block U.S. companies from operating training programs or providing for-profit education. In our multilateral and bilateral trade negotiations, we respect each country’s choices concerning public education, yet private educational and training opportunities can complement public schools.

(Zoellick, 2003)

Cross-border education not only expands scale but expands diversity of providers and programmes, thereby providing students with a wider range of choices. Similarly, when countries allow foreign providers to operate on their soil, the host government will declare that this is for the benefit of its citizens, in terms of widening choice and educational opportunity. The United States’ negotiation proposal to the WTO, for example, asserts that the presence of foreign education providers ‘increases the variety and amount of education services available to WTO members’ (WTO, 1998, p. 1). Accordingly, the USA has argued that countries’ policies relating to transnational education should ‘be reviewed and the restrictions liberalized to the greatest extent p...

Table of contents

• Cover Page
• Half Title Page
• Governing Cross-Border Higher Education
• Title Page
• Copyright Page
• Table of Contents
• List of tables
• Series editor’s foreword
• Acknowledgements
• Introduction
• 1 Global policy prescriptions: Trade, protection and competitiveness
• 2 The entrepreneurial state: Recruiting students
• 3 Managing the outflow of self-funded and sponsored students
• 4 Even the best laid plans: Student migration policy and its unintended consequences
• 5 Outgoing student migration: Steering the circulation of brains
• 6 Offshoring higher education: Regulating and promoting overseas provision
• 7 Regulation and quality assurance of foreign providers
• Conclusion
• Index