Up until the onset of the world financial crisis, selling higher education to foreign students had become the new global gold rush for universities across the developed countries. Whereas 600,000 students went abroad to study for their degrees in 1975, by 2000 the number had hit 1.8 million, five years later it reached 2.7 million. This year, the number may even pass the three million mark - a 66% rise in less than a decade - unless, that is, the gold rush is about to end.

If it does, it will not be just the wealthy western countries that will suffer. As the international education export market grew, so did the capacity of old and new education exporting countries to attract international students. At the same time, countries such as India and China began providing for their own students who traditionally looked abroad for higher education.

In recent years, US universities used their international standing to deliver more courses through joint or dual degree programmes and through overseas-based campuses. Cornell, Georgetown, Carnegie Mellon, Texas A&M, Michigan State and Georgia Tech were among the big names that other countries with overseas campuses had to compete with.

The US institutions were joined by British universities in booming markets such as India, China, Singapore and the Middle East. Last year, the Canadian government mounted a $2 million challenge to other nations' international education enrolments from China and India.

As part of the Canadian government's strategic focus on these countries, a pan-Canadian education brand was launched at the world's largest international education conference in Washington DC last May.

At the same time, countries such as China, Singapore and Malaysia had started building the domestic infrastructure to service more of the needs of their own students. The dominant countries in the education export market also faced increasing moves by competitors to deliver courses in English in traditionally non-English speaking countries, such as Japan, Korea, Germany and Scandinavia.

The Korean government began a campaign to raise the English level of all Koreans, starting at pre-school. Under the Brain Korea 21 or BK 21 project, institutions were encouraged - and funded in some cases - to offer more courses in English, more study abroad or exchange programmes, dual and joint degrees or articulation courses with overseas institutions to keep their young people at home.

The big question confronting all countries involved in exporting education, however, is how the financial and economic crises will impact on the global movement of students. Nations such as Australia, which now earns more than $14 billion a year (US$10 billion) from selling education to foreigners, has yet to see any sign of an expected fall-off in enrolments.

And Australia has the highest proportion of foreign students in its higher education system than any other country - with more than 19% according to the OECD. By comparison the OECD average is barely above 7%.

Yet the US Chronicle of Higher Education has suggested Australia might be losing its place. The paper reported last week that universities in Asia were facing hefty declines in enrolments of South Koreans. With the Korean currency dropping sharply, its students have found the cost of living abroad has doubled.

What effect this will have on US institutions is not yet clear although, as the Chronicle noted, South Korea remains a hugely important market for American universities which enrolled 70,000 students in the autumn of 2007, up 11% from the previous year.

"The country is an equally important source of students for many universities in Asia. The number of South Korean undergraduates studying in universities in Beijing and Shanghai is down by as much as 50% on some campuses, according to Chinese state media," the Chronicle noted.

"And undergraduate enrolments at some private Japanese universities have plunged to almost zero, forcing the institutions to take emergency measures, including deferring tuition and seeking government assistance. Enrolments are also reportedly down at universities in Indonesia, Malaysia and Australia, as thousands of South Korean students struggle to deal with the fallout from their country's violent currency fluctuations."

Australian universities, however, are not reliant on Korean students to anywhere the same extent as some US institutions, whereas those from China comprise by far the largest number of any from other nations.

Just as is the case with its importing of Australian raw materials, China will be the key to the financial well-being of many Australian universities which have become increasingly reliant on fees from Chinese students to bolster their declining revenues from other sources.

One reason for that is the fall in the value of the Australian dollar against the US greenback and the euro although how long that effect will last is uncertain. Equally uncertain is the future of the international gold rush in exporting education to other countries.

geoff.maslen@uw-news.com

* See the report: INDIA: Graduates look to study abroad during downturn in our Round-Up section

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