You are viewing a read-only archive of the Blogs.Harvard network. Learn more.

Chicago Booth: Hi Hong Kong!

The University of Chicago Booth School of Business has announced its decision to move its Asia campus from Singapore to Hong Kong, putting a half-year rumor to rest. Starting from 2014, students enrolled in the Chicago Booth’s EMBA program take classes in Chicago, London, and Hong Kong.

This is certainly something to applaud for Hong Kong. It is an endorsement from a world-leading business school that Hong Kong is the business hub of Asia. The EMBA program will also bring in many senior business executives from around the globe; these future leaders would then have a better understanding of Hong Kong, and some of them may even stay on to develop their careers here.

The Hong Kong government has for years claimed to develop the “education services industry”, hailed as one of the “six new pillar industries“, but with little success. The number of non-local students did see a large number of increase in the past few years, but the “non-local” label has become synonymous to “mainland Chinese” as they now comprise almost 90% of the non-local population (see chart below). Since most of these students are either heavily subsidied by the Hong Kong taxpayers, or are on scholarship funded by the Hong Kong universities, Hong Kong has in essence yet to monetize their education services “industry”. But of course, a direct financial loss can still mean an indirect gain, for example, if those mainland Chinese students are the crème de la crème, whose researches help raise the ranking and global reputation of the Hong Kong universities.

This also signals a (encouraging) change of mindset within the government. Haunted by the laissez-faire idoeology, the Hong Kong government has long been unwilling to provide incentives for the overseas educational instituions to set up campuses in Hong Kong. Neighbouring Singapore has pushed aggressively to attracted school like Yale, Wharton-INSEAD, ESSEC, to either partner with a local Singapore university or set up an independent campus there. The agreement to provide Chicago Booth with a prime land in Hong Kong for almost free signals the Hong Kong’s warming attitude towards industrial policy. This is a good start.

Yet the Hong Kong government should be mindful of two issues in order to make the Chicago Booth-Hong Kong partnership fruitful.

The first is to make sure Hong Kong would tap into the knowledge and talents that Chicago Booth would bring to Hong Kong. It is not the first time Chicago Booth relocates an overseas office. In 2005, it moves its European campus from Barcelona to London, because although Barcelona has nicer weather and food, London is the true financial center in Europe. Similarly, Chicago Booth has already had a 13-year relationship with Singapore before it decides to leave. If Hong Kong does not remain competitive in the coming decade, Chicago Booth would not hesitate to move its campus again at the end of this 10-year partnership with Hong Kong.

The second is to ensure that Hong Kong universities can upgrade their capabilities and be able to compete globally. By physically situated close to the University of Hong Kong, Chicago Booth would certainly bring more competition in the EMBA market in Hong Kong. Healthy competition is a good thing, but it is possible that the entry of Chicago Booth would suck up the talented potential students from HKU (or indeed other Hong Kong universities); in that case, the standard and reputation of the Hong Kong universities could suffer instead. A joint program such as the Kellogg-HKUST EMBA program – or joint school – is a better option, because it allows the local universities to leverage on the reputation on their partners, and even in case the partnership discontinues in the future, the local universities still retain the know-how and reputation to run their programs and compete globally.

But a joint-program/school is much trickier. The Yale-NUS College has attracted immense criticisms back at Yale for its possible inability to uphold academic freedom in Singapore, an “authoritarian state”. It also requires much more resources from the local government, of which Hong Kong government is rather unprepared to commit to. Indeed, the NYU Law School has recently terminated its partnership with NUS for that very reason:

The NYU@NUS program was initially established for 4 years — the classes of 2008 to 2011. Towards the end of this period, NYU and NUS decided to extend the program for another 3 years to the class of 2014. We have now agreed to conclude the program without seeking additional financing to extend it. In the last few years, the cost of graduate legal education has risen significantly, and running the program in Singapore has been made possible by a generous grant by the government of Singapore to fund the numerous scholarships offered. Unfortunately, the program did not become self-financing in the way we had hoped it would; continuing it in its present form would entail a significant diversion of financial resources on the part of both NYU and NUS. With regret, therefore, our two institutions have now arrived at the mutual decision to allow the program to conclude and not to seek a further extension.

Let’s hope Hong Kong can really industialized their educational services this time.

Comments 1