One year ago, on these pages, I urged Hong Kong to seize a once-in-a-century opportunity to become China's higher-education hub, its Boston. With more than 200 million increasingly prosperous mainlanders reaching college age this decade, most with no siblings, the demand for higher education is unparalleled. With our eight well-developed universities, Hong Kong is perfectly positioned to benefit. Yet the gains go to Australia, Singapore, Britain and the US, not us. As this week's stormy Legislative Council debate about further funding cuts underscores, it is time for a wiser higher-education policy.
At Legco 13 months ago, I urged members to see higher education as Hong Kong's compelling natural advantage among China's cities. I observed that in a global, knowledge-based economy, living standards rest almost entirely on education levels, and that Hong Kong under-educates its citizens even by regional standards. As a guide to our future, I asked legislators to imagine Boston without its universities.
Many from the tertiary sector have made similar pleas, with Carnegie Mellon economics professor Richard Florida telling Legco members that 'slashing the higher-education budget would be tantamount to economic suicide'. Yet they did, chopping 10 per cent from the higher-education budget and 6 per cent from faculty pay. Education Minister Arthur Li Kwok-cheung called this 'a victory for common sense'. It was more like nonsense.
Australia's foreign student enrolments are up 57 per cent in three years, and Chinese enrolments have jumped 304 per cent, with recent policy changes designed to attract even more foreign students. In Britain, university fees have been raised to enhance capacity and salaries. Last year, Singapore gave the equivalent of $1 billion, equal to Hong Kong's tertiary-sector cuts, to just one university, with a target to triple the number of foreign students in 10 years. Like the US, these nations realise that foreign students are a major source of foreign exchange, as they spend money on food, housing, entertainment, clothing, appliances, transport and 'out of state' tuition. Foreign students also provide rich talent for employers and tax revenue for government as they enter the workforce. With terror-motivated restrictions limiting access to the US, these countries see the historic opportunity, and their universities are prospering. Locally, universities are struggling to cut costs and cope with a coming two-year budget freeze, while simultaneously being asked to shoulder a fourth year of study. Government quotas and tuition restrictions impede local universities from attracting more paying foreign students. With pay cheques shrinking, Hong Kong talent is being wooed by seductive offers from universities in mainland China, Australia, Singapore, Europe and North America, particularly in high-demand fields, such as biotech, IT and management studies. Staff shortages worldwide would make them very difficult to replace.
Again, I call on Hong Kong's leaders to realise this historic opportunity to guarantee enduring prosperity for Hong Kong as China's education hub, before it is lost. Rather than cutting or freezing higher-education budgets, restore and enhance them in ways that reward quality and achievement, as wise Legco members advocate. Rather than capping foreign student enrolments, set minimum quotas. Rather than restricting tuition, grant universities more freedom in setting fees, as is now the policy in Britain, and long-standing practice in the US. Promote different specialities for universities and address structural issues directly. Then we will hail your wisdom.
Gary Biddle is associate dean in the school of business and management and head of the department of accounting at Hong Kong University of Science and Technology
