New rules - drafted by the Ministry of Education and approved last month by the State Council, China's cabinet - will allow foreign educational institutions to establish joint ventures (JVs) that provide education services in China.

The guidelines are expected to boost China's already-heated education market.

The education sector is one of China's less-developed, but highly promising, markets. There is huge potential within the sector, given China's nearly 1.4 billion population.

Officials expect the regulations will stem the flow of Chinese students to overseas colleges and universities.

"The government especially encourages domestic higher education organizations to co-operate with established top overseas partners," the rules stipulate.

The rules, for the first time, will clearly identify approval procedures and time lines, which have been shortened from three months to 45 days.

Besides, the degrees or certificates awarded by the joint ventures are expected to hold the same authority as degrees issued by the overseas partners in their home countries.

"While most applicants value the high quality education provided by such Sino-foreign schools, many are more attracted by the guaranteed foreign certificates," said an official with the Chinese Service Centre for Scholarly Exchange.

Chinese Education officials began drafting the provisions two years ago, in the wake of China's World Trade Organization (WTO) entry.

A temporary act, introduced in 1995, presently supervises joint-venture schools' operations.

As special market cases, 100 Sino-foreign programmes were approved before March to grant foreign degrees.

Another 20 are awaiting approval, said an official with the State Council's Academic Degree Committee.

"Both numbers will shoot up once the rules are implemented," he predicted.

Experts suggest such joint ventures will allow Chinese students to receive degrees from world-renowned universities for a fraction of the price generally charged students who study overseas.

Courses in China will likely cost between 20,000-50,000 yuan (US$2,425-6,060) a year. Chinese students who study overseas generally pay more than 140,000 yuan (US$17,000) a year.

"More well-off Chinese families can afford the tuition fees of these joint venture schools, which will provide courses up to international standards," said Zeng Gang, head of Zhuoyue International College, which is affiliated with the University of International Business and Economics.

The Sino-US joint venture institution turned down 30 per cent of its applicants seeking enrolment in five of its undergraduate programmes, Zeng said.

The school's tuition this year is 33,500 yuan (US$4,120), more than four times China's 2002 per capita gross domestic product.

A lucrative source of candidates for co-operative programmes, experts suggest, would be the large number of teenagers who have failed college entrance examinations.

China's high school graduates, if hoping an enrollment in colleges, are required to complete these exams, which are conducted each year.

Eleven per cent of China's middle school students reportedly are capable of completing college or university educations. The government hopes to increase that rate to 15 per cent by 2010, leaving more room for non-government-run schools.

More than 400,000 Chinese students have studied abroad since the opening-up in the late 1970s. The rapidly increasing number of students studying overseas in the past two decades has corresponded with China's economic growth.

That growth is expected to slow down if foreign schools establish their presences in China, said a business analyst.

China's annual education expenditures account for a mere 1.4 per cent of the global cost of public education, far below its school population, which makes up 23 per cent of the world's total, indicate statistics.

China since the early 1990s has allowed private companies to run schools. Private and foreign schools, however, are not as developed as their State-run rivals.

Foreign universities and educational organizations, limited by strict regulations in their home countries, will only issue selected degrees or certificates to graduates of joint programmes in China, Zeng said.

"Top foreign universities are usually subject to more strict rules than second-tier ones," Zeng said.

"That is why top universities are rarely seen as partners in co-operative programmes, especially in undergraduate education."

Apart from higher learning programmes, vocational and technical education institutions will also boom in the Chinese market, experts said.

To meet demand for expertise in various fields resulting from China's WTO membership, Shanghai, a metropolis in East China, has established more than 150 Sino-foreign schools.

More than 50,000 Chinese students, with varying educational backgrounds, attend the schools.

Provincial or regional governments will have to approve establishment of any Sino-foreign vocational and/or technical institutions, the proposed guidelines stipulate.

Co-operative higher learning programmes would have to be approved by the Ministry of Education and the Office of Academic Degrees Committee of the State Council.

The guidelines would ban co-operative programmes that involve preliminary education and courses in military affairs, policing, religion and politics.

The proposed rules also outline the organizational and managerial structures for Sino-foreign joint schools, and detailed application and deadline procedures.

The guidelines reportedly are based on the ministry's inspections in Beijing, Shanghai, Guangzhou, Shenzhen, Zhuhai, Wuhan, Chengdu, Chongqing and Zhengzhou.

The proposed rules also take into account surveys conducted by China's embassies and consulates.

(Business Weekly April 22, 2003)