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Home / Business / Economy

The battle to attract international students

Tamsyn Parker
By Tamsyn Parker
Business Editor·NZ Herald·
13 Mar, 2009 03:00 PM11 mins to read

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Chinese parents and students check out the options at the China International Education Exhibition Tour in Beijing. Photo / Supplied

Chinese parents and students check out the options at the China International Education Exhibition Tour in Beijing. Photo / Supplied

The first time I arrived at Wellington airport I was picked up by a shuttle bus.

When the driver spoke to us I could hardly understand a word," says Chinese national Tingxi Ming of his first experience in New Zealand as an international student.

It came as a huge
shock for the now Chinese Ministry of Education official who had already completed a degree in English language and culture in China and spent seven years teaching.

But he attributes his experience as a masters student at Lincoln University to his promotion within the ministry and for his role as the organiser of China's biggest international student fair, the China International Education Exhibition Tour.

The fair, where educational institutions from around the world promote their courses to prospective students, is an important event for New Zealand's $2.3 billion education export industry because more than a quarter of our international students come from China.

Ming, at the Beijing leg of the tour, looks relaxed as thousands of anxious parents and students charge around the Beijing World Trade Centre collecting brochures by the bagful on their future educational possibilities.

There are more than 900 booths from countries all around the world and 30,000 Chinese are expected to attend the two-day event.

Ming says some booth-holders, such as the British contingent, have been hit by the global economic downturn, but the numbers are consistent with last year's fair and the pressure on China's young people to get a good education remains a vital part of the culture.

"In Chinese culture education is valued very much. The aim is to become an official to change a family's status."

The lack of tertiary infrastructure in China means many students must look overseas.

While China's growth has also been pulled down by the difficult times, Ming says China's currency has strengthened against the Western world, making it cheaper to study abroad. And a lack of jobs for new graduates in China is also motivating many to look at post-graduate study.

He says the financial crisis may have some impact on numbers but it is likely to be mild thanks to the huge body of students in China.

That is music to the ears of New Zealand's education export industry. The number of Chinese international students in New Zealand has plummeted since 2002 from around 56,000 to less than 25,000 in 2007.

International students hit 126,000 in 2002 but have since fallen to just over 90,000.

Education New Zealand chief executive Rob Stevens says the bubble was caused by high Chinese numbers which were never going to last.

"We were the first Western country to open the door to recruiting Chinese students. Other countries had quite high barriers mainly due to political reasons.

Then all of our competitors came in so we were naturally going to decline."

The collapse of two high-profile private training institutes in 2003 - Carich and Modern Age - also had an impact.

Since then students from India and Saudi Arabia have increased but the loss from China and other Asian markets such as South Korea and Japan have continued to drag the numbers down. But now the dollar has dropped Stevens hopes numbers in the sector will rise again.

"With offshore consumers more focused on seeking value for money, New Zealand's value proposition - quality education at an affordable price - will be more attractive relative to our traditional competitors."

Stevens says many of the Asian markets view education as an essential investment.

"While discretionary spending is going down around the world, many parents in countries where there are educational infrastructure shortages, such as India and China, would not consider sending their children to a good university as 'discretionary' as they could have been saving up for this since the children were born, and they're unlikely to be dissuaded from it even if it requires other sacrifices."

It's a view supported by Chinese agents.

Mica Yao, a client relations manager for EduGlobal China, who studied in New Zealand herself, doesn't believe the economic crisis will stop Chinese from sending their children abroad.

"No, that has enhanced the market to go abroad. Because of the economic crisis it makes the exchange rate lower. People feel they can't do business so they should invest in education."

Kevin Zheng, a director for JJL Overseas Education, believes Chinese people won't stop sending their children overseas because they want them to have a bright future.

But he says at this stage it's not clear what the full impact of the economic crisis will be.

"At the moment the people who choose to study overseas, the family has enough money. But after one or two years many people will quit or be fired from their jobs and they will not have a reliable income."

Zheng says that could benefit New Zealand which is seen as a cheaper place to study.

The University of Auckland has said its applications are 20 per cent up on last year and AUT has also reported a 17 per cent increase in international student applications.

But Lincoln University marketing and recruitment manager Roger Armstrong, one of 15 New Zealand institutions at the trade fair, says it may be too soon to know whether numbers are up until the students actually turn up.

"Our applications are up by 15 per cent this year. But the application is the easy part. It is converting the applications to enrolment that is going to be the tricky thing."

The Ministry of Education is expected to produce enrolment figures this month.

Armstrong expects applications to continue to be strong this year and Asian enrolments to hold up because of the weak dollar, but that may only make up for drops in the US and European markets.

"It is hard to predict - the dollar is low - but people are very worried about their job situation. But to our advantage there are two parents with one child in China focused on education - that might work to our advantage."

Christchurch Polytech international account manager Annie Goh, who has come to the student fair for the past six years, says the numbers of short-term English students who come to New Zealand on tourist visas could be threatened.

"I'm not sure about tourism - whether we will get many short-term English students this year - I think 2009 will be OK. But 2010 will be an interesting year."

It's a concern shared by English New Zealand chairman Rob McKay.

A survey by the volunteer organisation found 55 per cent of English schools reported forward bookings down on last year and 30 per cent reported flat forward bookings.

McKay says given 54 per cent of international students study English language before going on to other study, he expects the flow-on effect to other parts of the sector to be significant.

"High school or university students made their decision last year. But we are finding students are in a much more dire position this year."

McKay said changes to the English language sector happened much more suddenly because students on average studied for only 12 weeks.

That situation had played out when the Chinese market dropped off - it happened first at the language schools and then took some years to flow through to the universities.

McKay says a change to the immigration legislation levelling New Zealand with Australia could help.

An anomaly in the law meant students who went to English language schools had to take a language test before taking up part-time work whereas those studying at universities or high schools did not have to.

"They aligned the regulations with Australia but left off English language schools. It's just completely illogical," he said.

A change in the regulations could result in a 25 per cent boost in English language export potential to $700 million and an extra 800 education jobs.

McKay believes the net effect will be more significant than the possible displacement of jobs for New Zealanders caused by international students taking up work. "Most don't actually seek it - they just want to have the ability. They just want to have as many options as they can get."

He said the body had been fighting with the Labour Government to get the immigration law changed for the past five years.

He was hopeful the new Government would change it.

Education New Zealand's Stevens said although English language schools appeared to be taking a hit it was difficult to predict what impact that might have on the sector as a whole.

Stevens said many students were now studying English in their home countries before coming to New Zealand.

"People have got to have English to study in this country but they don't need to learn English here. That is what a lot of people are doing - studying English in Beijing."

Stevens said English language schools had a future in New Zealand.

They tended to have a high turnover attracting students for short-term courses. "The English language market has high volume but if you look at it from a foreign exchange perspective, schools and tertiary institutions economically are incredibly important."

A typical bachelors student could bring $40,000 into the economy a year and only one third of that was in fees.

From an economic perspective universities contributed close to 40 per cent of the total export earnings in the sector and English language schools contributed 10 per cent.

Stevens said the peak of 126,000 international students reached in 2002 was still the capacity point for New Zealand but there was a great potential to increase the yield per student.

"If we can trigger more demand, it's not just a capacity game, we can charge more so we can go up the supply chain."

He believes greater promotion and money to promote the industry from the Government will be the key to tapping into that potential.

THE NUMBERS
* The international student industry earns $2.3 billion a year.
* Employs 32,000 people.
* More than 90,000 students study here each year.
* More than 25 per cent come from China.

BIG MARKETS
Top 10 source markets for international students (2007)
* China: 27.1 per cent
* South Korea: 19.6 per cent
* Japan: 13.4 per cent
* India: 4.1 per cent
* Germany: 3.4 per cent
* Thailand: 3.2 per cent
* Taiwan: 3.1 per cent
* Saudi Arabia: 2.9 per cent
* Brazil: 2.7 per cent
* USA: 2.5 per cent

WHERE THEY STUDIED
* Schools (includes primary and secondary) 17 per cent
* Tertiary institutes 34 per cent
* Private providers 46 per cent
* Other 3 per cent

STUDENT NUMBERS
* 2003: 121,164
* 2004: 112,664
* 2005: 98,268
* 2006: 95,296
* 2007: 91,301
Source: Ministry of Education

NZ DEGREE HAS ZHANG FLYING IN CHINA
Pai Zhang was not a strong student at high school and knew his chances of getting into university in China were slim.

But coming to New Zealand to attend Massey University in 2005 to study a bachelor of aviation management gave him a chance to pursue his dreams of working in the airline industry.

"I had always been interested in planes," says 27-year-old Zhang, who now works for NorthWest Airlines as a cargo officer in Beijing. "But I was not a good student."

Zhang became interested in New Zealand because a friend studied in Auckland. He also liked New Zealand because he didn't have to take an exam to study English here.

Zhang studied English in Newmarket at Aspect International for eight months before starting his degree.

"I didn't speak much English before coming to New Zealand," he says. "I just knew some words, but I didn't know any grammar."

He says one of the most useful experiences he had studying in New Zealand was gaining practical experiences rather than just theory.

He was surprised to see New Zealand children or teenagers being allowed to work.

"There has been a one-child policy in China since 1979 and China tends to over-protect their kids. Most Chinese teenagers never have a part-time job."

He lived in a homestay for three months, but the food was very different and he then rented a room with a Chinese family.

Zhang's grandparents helped pay for his study from money made during their careers as chemical and biological scientists.

While he enjoyed living in New Zealand, he decided to return home because of family and says he was lucky to get the job with the airline.

He doesn't speak English in his job but uses his knowledge to read emails from head office in the United States.

* Tamsyn Parker travelled to Beijing as a guest of Education New Zealand.

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