1. The Global Market for Education Harry Anthony Patrinos World Bank hpatrinos@worldbank.org AUCC International Conference Montreal, Canada October 31 - November 2, 2000

2. Size of the Global Market  $2 trillion (Merrill Lynch)  Teaching staff employed in education:  2% to 5% of labor force  1.5 M+ tertiary students abroad: $27 B  One-third of global market in USA  15% in developing world

3. Wages Relative to Wages with No Schooling 0 1 2 3 4 5 6 Indonesia Thailand Peru Cote d’Ivoire USA Slovenia Primary SecondaryPost-secondary

4. Tertiary Education Challenges  Low enrollments and decreasing public resources  Inequality in access  Lack of quality and relevance  Globalization -- New Economy

5. Financial Issues  Public spending inefficient  Over-subsidized higher education  In Africa, higher education spending/student = 44 X primary  Governments less able to bear increasing cost of expanding public system

6. Evolution of Tertiary Education Enrollment (1980-1995)

7. Private Enrollment in Tertiary Education

8. Fees as Share of Expenditure at Public Institutions

9. 2 3 7 9 22 23 25 26 37 41 45 57 0102030405060 Uganda Chile Korea Indonesia United States Mali Japan Germany France Denmark Netherlands Sweden Household Spending (% of total education spending, all levels)

10. Private Sector Share of Higher Education Enrolments Korea 75% Indonesia65% Philippines 80% Colombia 60% Brazil 60%

11. Private Higher Education in Developing Countries  100% of professional training in Cote d’Ivoire  44% of skills training market in The Gambia  Almost non-existent in Mauritania  75% of tertiary colleges in India  1,274 institutions, 4 Million students in China  37 tertiary institutions in Ghana (11 accredited)

12. Private Higher Education in Developing Countries (cont’d)  Fees main source of income  Serve both rich and poor  New sector  Complete range of institutions  Ownership types  Offer limited range of courses  Often use part-time staff  Regulatory framework less developed

13. Significant Growth  3 new colleges currently being set up in Ghana  500 new tertiary institutions in China, 1995-99  7 universities, 25 colleges applied in Cameroon  27 applied in Kenya this year  4 universities registered, 19 in development or in process of accreditation in Tanzania

14. Private Business Schools in Eastern Europe, 1998  Poland91  Czech Republic29  Armenia21  Romania18  Bulgaria 4  Slovenia 1  Macedonia 0

18. Brazil: Objetivo/UNIP  1962 a ‘coaching class’ for pre-university students -- 20 students  Largest chain of private schools and universities in the world:  514,000 students  482 campuses/sites - majority franchised  Turnover US$384m (1996-7)  Profit US$40 m (1996-7)

19. Romania: CODECS F Romania: Centre for Open Distance Education for Civil Society F Est. 1993 F Distance education in business and management F 2,578 students in 1997

20. For-Profits Targeting Developing World  Apollo Group (Univ of Phoenix) -- Apollo International  Sylvan Learning Systems -- Universidad Europea de Madrid  Unext.com?  Columbia, Chicago, Stanford, LSE, Carnegie Mellon

21. On-line Education  African Virtual University  Est. 1997, 15 African countries, 2,500 hours of instruction, 12,000 students  NextEd.com  Est. 1998, 12 universities (Aus, Can, Hol, NZ, UK, US), 2,600 students, 21 countries

22. South Africa: Educor F Est. 1943, as ‘cramming’ college F 1997 - internal expansion and acquisition of other companies in southern Africa: 300,000 students on 43 campuses F 1999 - global expansion - purchases 50%+ of International Business Schools, Toronto

23. India: NIIT F Est. 1979, as computer training company F Now has 400 centres in India and has expanded into 30 countries

24. http://www.worldbank.org/edinvest  A joint WB/IFC/private sector initiative  Country Market Reports for investors  Database on potential investments  Exchange of ideas and market information  Regional Conferences

25. Messages  Competition in education brings new set of responsibilities  Investigate the market for education  Internet will change higher education  Trade will become an issue