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In my opinion

Fiscal crisis may be an opportunity

Canadian universities could benefit if they boost efforts to recruit
international students, who want quality for fair cost

BY LEON TRAKMAN | FEB 09 2009

As the world goes through the fiscal crisis, Canadians will be remiss if we do not take advantage of the opportunities created by our unique social, economic and political system. Although hard times are ahead for all of us, there are also benefits that we are situated to reap. One of those benefits is international higher education.

Although we tend not to think of it this way, higher education is a major international industry that provides export income for those countries that are able to attract significant numbers of foreign students. Until the United States closed its borders by severely restricting visas after the World Trade Center attacks, America gained much of the benefit of this export industry. In the last decade, Australia was able to siphon off some of the United States’ educational export dollars.

Now, the fiscal crisis that has everyone so perplexed offers the chance for Canada to reap significant trade balance benefits from our excellent system of postsecondary education.

The global financial crisis has trammelled the university sector and exposed the fact that universities are “businesses” that “sell” education and research at a loss and expect to make up the difference through either government support or from private charity and endowments.

The financial crisis makes private charity less likely for both public and private schools; while government, at least in the United States, has already moved away from funding public education to the point that the most prestigious state universities charge private university tuition.

In contrast, Canadian universities will be less severely impacted by the global economic downturn than their international counterparts because financial exigencies are generally more burdensome elsewhere than in Canada. For example, the high cost of tuition at leading U.S. private universities is increasingly unaffordable, with full fees charged to out-of-state and international students by public colleges having increased more in the United States than at Canadian universities.

Not only are Canadian universities better positioned than U.S. universities to take advantage of the international export market in postsecondary education, they are advantaged in comparison to other countries as well.

U.K. universities anticipate huge budget shortfalls as the Gordon Brown government struggles to support the besieged financial sector, and the experience of many European universities is likely to be comparable. Asian universities that flourished during China’s growth spurt are increasingly cash-strapped, as 10-percent economic growth recedes into 10-percent declines.

In comparison, the “public” attributes of university education in Canada are deeply ingrained and less easily dislodged than among our many competitors. “Privatized” tuition in Canada will continue, but tempered by the belief that qualified students have a “right” to a postsecondary education, as distinct from higher ed being a privilege available only to those who can afford it.

Further, and this is particularly significant, in contrast to the rest of the world, Canadian universities are unlikely to reduce the quality of our postsecondary education. The international market is increasingly responsive to high-quality university opportunities at affordable prices. Canadian universities can deliver that quality at those prices. Leading Canadian universities are now well-placed to fill gaps in the international market caused by the international fiscal crisis.

Only the failure to recognize the opportunity can stand in our way. If the federal and provincial governments cut university funding as one way to deal with the fiscal crisis, then Canada will lose the ability to increase its share of the global education market.

This is not the time to cut what might well be one of the best export industries we have.

By continuing to provide excellent value at a reasonable cost, Canada can become the primary educator in the new cost-conscious world, thereby increasing our influence as well as our treasury.

Leon Trakman is the immediate past dean of the faculty of law at the University of New South Wales in Sydney, Australia. A Canadian, he has taught and studied throughout the English-speaking world, including at Harvard University, Dalhousie University and the University of Cape Town.

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  1. Vicky Busch / February 20, 2009 at 16:53

    Don’t forget about the incredible value of Canada’s online and distance university education for international students.

    Distance education is an even better value for international students since they don’t have to travel to Canada and live away from home. For many students, it may be the only way they can attain an international education.

    In addition, most undergraduate distance programs can respond quickly to increased demand, without taking “seats” away from Canadian students.

    Canadian universities have developed hundreds of high quality degree programs completely at a distance, offering international students the best educational value on the planet.