Education ties between the United States and China have grown stronger in recent years. From 2011 through 2015, the number of Chinese students attending universities in the U.S. rose to 304,040 – an aggregated total increase of 93%. But the trend goes both ways. China’s Ministry of Education estimates that there are now over 2,000 joint ventures between American and Chinese universities in operation, and the number is growing. While many of these ventures are short-term, including study-abroad programs, an increasing number of American universities have developed full-fledged, degree-granting programs in association with Chinese institutions. These schools, trailblazers in a booming sector, face both challenges and opportunities. What entices them to establish ties to China? And, once here, how do they ensure that they are successful?
A popular assumption is that American universities come to China to reap the bounty of a lucrative education market, and the potential is certainly there. The high value placed on education, coupled with the prestige associated with a foreign degree, entice many deep-pocketed parents to invest in their child’s education at the Chinese campus of a foreign institution, such as NYU Shanghai, Duke Kunshan University (DKU) or the Hopkins-Nanjing Center (HNC).
“Many universities that are exploring campuses and relationships in China do hope that it will be a revenue generator, because there are so many students in China,” says Madelyn Ross, Director of the HNC’s Washington Office.
Professor David O’Connor, dean of Research and Graduate Studies at Xi’an Jiaotong-Liverpool University (XJLTU), describes the environment as an “academic gold rush.” O’Connor notes that XJTLU, whose student body at its Suzhou campus is around 90% Chinese, has experienced this growth firsthand since opening in 2006. “It started off with 164 students,” he says. “It’s now got over 10,000. The rate of growth must have been probably the fastest in the world for a university in quite some time.”
But the financial benefits for the foreign universities so far appear to be slim. “I don’t know of any foreign academic institution that has done things in China and brought net profits home,” says Jeffrey Lehman, NYU Shanghai’s vice chancellor and founding dean of the Peking University School of Transnational Law.
DKU’s executive vice chancellor Denis Simon agrees. “If one wants to make money, this is not the way to do it,” he said.
A key reason why profits are sparse is that maintaining the meritocratic admissions process and a roughly equal balance between Chinese nationals and international students to which most foreign universities aspire is expensive. Take, for example, NYU Shanghai, which charges approximately US$45,000 a year per student place. NYU New York knew that Chinese students would require financial support, but they also made it clear that they would not subsidize costs for those students. Because of this, Lehman says, NYU Shanghai “was not going to be a revenue source for New York. This was going to be financially a tub on its own bottom.”
Costs associated with operating a school from overseas also limit profitability. Ross notes that the Hopkins-Nanjing Center is, after 30 years of operating in China, “to some extent still subsidized by Johns Hopkins and the Paul H. Nitze School of Advanced International Studies (SAIS).”
Despite the costs, maintaining a campus in China gives Johns Hopkins and SAIS a reputation boost as a global leader in international affairs studies.
Some institutions, though, have found ways to turn a profit. In Suzhou, the University of Dayton’s China Institute uses partnerships with nearly 20 Chinese universities to attract students from their home campus and partner universities. Students from their Chinese partner universities are given a 70% discount on the US$53,000 annual cost of tuition, room and board. While it does not grant degrees, the China Institute offers a pathway program alongside its semester-long programs to help Chinese high school students prepare for the American education system. “We do think of [our pathway program], like all of our programming, as creating an additional revenue stream for our university,” said Jiajia Wei, executive director for the China Institute.
Besides the profit outlook, there are other ways in which universities that want to develop a Chinese campus are entering an uncertain environment, particularly in terms of regulations.
HNC’s Ross notes that in recent years, only “a few universities who have been really dedicated to this have found a way to make it work – and they’ve had to face a variety of complications, including a much stricter Chinese regulatory environment than what we negotiated 35 years ago when we signed our first agreement [of intent with Nanjing University].”
One of NYU’s biggest problems was how to address issues of regulation and compliance. “There will be Chinese law zoning and safety requirements, there will be US law requirements, and the question is: Which one do you abide by?” Lehman says.
He adds that NYU abides by the requirements of both countries, but acknowledges that this position might one day be untenable. “Our fear is that we’re going to run into something where one side is saying ‘you have to drive on the left side of the road’ and the other says ‘you have to drive on the right side’…We haven’t run into that yet, but it is something that was talked about quite a bit.”
Joint venture universities must be helmed by a Chinese citizen, who serves as the legal representative for the institution. “The worry in China is that some foreigner would come and pretend to be in compliance with Chinese law, and then run away,” says Lehman. Because of this, foreign universities must ensure that they carefully select Chinese partners who share their vision for the joint venture.
Foreign universities in China must also contend with concerns from their home countries regarding academic freedom. During a United States Congressional subcommittee meeting in 2015, Congressman Christopher Smith summarized the issue: “Official Chinese Government decrees prohibit teaching and research in seven areas…including universal values, press freedom, civil society, citizen rights, criticism of the Party’s past neo-liberal economics, and the independence of the judiciary…which begs a very significant and important question: Are U.S. colleges and universities compromising their images as bastions of free inquiry and academic freedom in exchange for China’s education dollars?”
In February 2016, NYU Shanghai invited Congressman Smith to give a public talk on China’s human rights record. Although the Congressman was critical of China’s human rights record, a spokesman for NYU Shanghai says they faced no political consequences. Rep. Smith’s office did not respond to requests for comment.
To ensure academic freedom, Lehman says “it’s important that in the [preliminary conversations], an understanding be reached that the university will be one that respects the concept of academic freedom as it is used on the American campus. That’s a discussion that needs to happen openly and explicitly.” This echoes the experience of the HNC, which offers one of the only uncensored, open-stack libraries in China and hosted a public conference on democracy in the wake of the 1989 Tiananmen Square events. Ross says that freedom of research, speech, discussion and access to information were all “non-negotiable, bottom line” principles in the discussions leading to their founding. Nowadays, Ross says, “as long as it’s at the Center, HNC students can show a film or have a conference that might not be as easy to do at Nanjing University.”
But even if a university is assured that these freedoms will be protected, convincing faculty that these promises will be upheld is just one of the many reasons foreign universities struggle to enlist faculty from their home campus to teach at their Chinese campuses. For many universities, this is one of the biggest challenges in launching their China operation.
After 30 years of operations, the HNC now has nine international faculty members with an average tenure of five years, but Ross says “there have been periods where it was really difficult to get faculty who wanted to come and teach for more than a year.” The director of an Ivy League university’s China center said that their university has rebuffed invitations from the Chinese government to develop a degree-granting China campus in large part because they could not attract enough faculty to provide the education experience for which they are known.
In 2010, the Chinese Government released the “Outline of China’s National Plan for Medium and Long-term Education Reform and Development (2010-2020).” The Plan states that the goal for opening the education market to foreign influence is to help reform, to enhance the quality of the domestic education market and to increase the capacity of Chinese students to compete in the global marketplace. However, recent government measures appear to contradict the plan (see sidebar). Furthermore, foreign universities are still required to partner with local universities when opening a degree-granting campus.
Most of the administrators interviewed said that the success of their venture hinged on being diligent in selecting the right local partner. Higher education institutions that want to come to China must “make sure [they] select the right partner in the right location,” said Simon. “The more you and your Chinese partner find that you really have similar goals and similar curriculum interests, the better,” echoes Ross. Lehman puts things bluntly: “Everything turns on the partners. You have to have the right partners, and they have to have the right philosophy, appetite for risk and belief in the nobility of this project…Each side has to feel that this is academically a project that is worth doing.”
Once selected, developing a strong working relationship with the partner and working out all of the kinks that come with a new venture takes time. Although DKU initially thought they could rest on the laurels of the Duke brand, they quickly learned otherwise. “We have engaged in a complete re-think of our initial approach and have developed a strategy much more consistent with the reality that Duke Kunshan University is a startup venture and thus, like almost all foreign brands in China, must establish its credibility and build confidence that it is here to stay in the Chinese academic market,” says Simon.
O’Connor’s assessment of the situation at XJTLU seems to echo how many administrators feel about their work in China. “It remains to be seen how this will pan out in the longer term,” he says. “I think everyone would admit that China is an environment that’s difficult to work in, and it just takes one really bad policy change to knock things out. So, we have to be cautiously optimistic – but, for the moment, things are looking reasonably good.”