RESEARCH REPORTS www.asiapacific.ca MARCH 19, 2014 ©iStockphoto.com/Rawpixel BUILDING A STRONGER CANADA-ASIA RELATIONSHIP THROUGH TWO-WAY EDUCATIONAL LINKS by Dominic Barton About The Author Dominic Barton is the Global Managing Director of McKinsey & Company. In his 25 years with the firm, Dominic has advised clients in a range of industries – including banking, consumer goods, high tech and industrial – but his core area of work is in financial sector development and reform. Prior to his current role, Dominic was McKinsey’s Chairman of Asia from 2004-2009, based in Shanghai, and he led McKinsey’s office in Korea from 2000-2004. To find out more visit:www.asiapacific.ca 1 www.asiapacific.ca Research Report BUILDING A STRONGER CANADA-ASIA RELATIONSHIP THROUGH TWO-WAY EDUCATIONAL LINKS Although many of Canada’s leaders and high-profile reports have emphasized the importance of international education to Canada’s future, action to date has been modest and sporadic. On the ‘inbound’ side, which focuses on attracting students from other countries to study in Canada, we face intensifying competition. International students are highly coveted for their financial contributions to the host economies, their potential to become skilled workers after graduation and their ability to serve as ambassadors in building closer relationships with Asian nations. To merely stay competitive, Canada needs to significantly boost funding and promotion of its education offerings. On the ‘outbound’ side, which focuses on sending more Canadians to Asia, there is an even wider gap between what Canada is and should be doing, especially in comparison with Australia, New Zealand, the U.S. and U.K. Nor are we doing enough to prepare our young people with the knowledge, language training and cross-cultural skills that they will need to be confident and effective working in and with Asia. This paper recaps why strengthening two-way education links with Asia is of critical importance to Canada and what actions should take priority. INTRODUCTION in recruiting students from Asia, so have others, notably “The time to act is now so that Canada’s full potential in the United States, the United Kingdom, Australia and New international education can be fully realized…. We are Zealand. To merely stay competitive, Canada needs to facing a narrow window of opportunity.” — Advisory Panel significantly boost funding and promotion of its education on Canada’s International Education Strategy (August 2012) offerings. But there is potential to achieve even more. “We must act quickly to strengthen Canada’s position as Another important dimension is the ‘outbound’ side: an ideal destination for the most talented students and sending more Canadians to Asia through study abroad, researchers.” — Canadian Council of Chief Executives internships, field schools and co-op placements - referred (September 2012) to generally as “mobility” programs. Here, there is an even wider gap between what Canada is currently doing and “Asia’s economic and geopolitical rise is hardly news for what it could and should be doing, especially in comparison anybody…. But is Canada, as a whole, preparing itself for with countries such as Australia, New Zealand, the U.S. and relevance and prosperity in a more Asia-centric world? The U.K. Nor are we doing enough to prepare our young people answer is not fast enough.” – Dean Connor, President and with the knowledge, language-training and cross-cultural CEO of Sun Life Financial, at the Asia Pacific Foundation skills that they will need to be confident and effective of Canada’s “Canada-Asia 2013: Navigating Asia’s Future, working in and with Asia. Charting Canada’s Strategy” (June 2013) This paper recaps why strengthening two-way education Such urgent exhortations about the importance of links with Asia is of critical importance to Canada and international education to Canada’s economic and what actions should take priority. In its report last year, sociopolitical future have appeared in more than half a the Advisory Panel on Canada’s International Education dozen reports over the past five years (see Appendix). In Strategy set out the target of doubling the number of full- that time, the Stephen Harper government has strongly time international students at all levels (K-12, university, stated its commitment to boosting education links between language and vocational schools) to 450,000 within a Canada and Asia. However, action to date on developing decade. Considering that international enrolment growth these two-way educational links has been modest and in Canada has averaged 10% over recent years, we believe sporadic — not enough to move the needle for Canada. this to be an achievable, even conservative, goal. We also believe that Canada should focus on attracting Asian One very significant dimension of international education is students — especially from India and China — with the aim the ‘inbound’ side: attracting students from other countries of strengthening our links with those fast-rising economies. to study at Canadian universities, colleges and primary and secondary schools. As the global education market The same report also recommended the creation of expands and Asian students’ wealth and mobility grow an international student mobility program that would rapidly, Canada faces intensifying competition in this arena. serve 50,000 Canadian students by the year 2022. While International students are highly coveted for their financial individual universities and colleges are setting their own contributions to the host economies, their potential to goals to boost the outbound side of international mobility, become skilled workers after graduation and their ability there needs to be complementary effort to promote Asian to serve as ambassadors in building closer relationships countries as destinations. Of the estimated 3% of Canadian with Asian nations. While Canada has made large gains students who participate in some type of study abroad www.asiapacific.ca 2 Research Report BUILDING A STRONGER CANADA-ASIA RELATIONSHIP THROUGH TWO-WAY EDUCATIONAL LINKS program, only a small fraction of them choose a program in Asia, despite the growing evidence of Asia’s importance to Canada’s future prosperity. It is clear that the issue of boosting two-way education exchanges with Asia needs a national champion. In Canada’s complex jurisdictional landscape, responsibility for interrelated aspects of education, research, innovation and international trade is dispersed among numerous government bodies — and thus is owned by no one. In order to get past the terrific studies and to move to action plans, someone needs to mobilize the numerous stakeholders, coordinate their efforts and set out priorities. WHY FOCUS ON EDUCATION ©iStockphoto.com/CEFuthcer Creating educational bridges between Canada and Asian powers has the potential to deliver wide-ranging, long-term within 20 years there will be almost two million unfilled returns on investment that few alternative investments can knowledge-industry jobs in Ontario alone. International match. students who choose to remain in Canada represent a highly desirable source of immigrants capable of ■ Economy: International students bring enormous integrating well. What’s more, they will be a key source value to the Canadian economy, spending more than of entrepreneurial talent. One U.S. study found that a $7.7 billion per year on tuition, accommodation and quarter of high-tech startups in that country had at least discretionary purchases. Their contributions translate one immigrant founder, and more than half of these into 86,000 jobs and generate more than $445 million entrepreneurs entered the U.S. as students. in annual tax revenue. Education is already Canada’s But we should not rely on immigration alone to fill critical th 11 -largest export, bringing in more revenue than coal gaps in our labour force. Canadian companies are in dire 1 or softwood lumber. need of workers with knowledge of and experience Over the longer term, Canada will also need to make in Asia in order for them to compete in those growing strategic investments in the Asia skills and knowledge markets. In 2012, an Asia Pacific Foundation of Canada base of its own population so that Canadian (APF Canada) poll found that six in 10 companies struggle companies and governments will be equipped to to find Canadians qualified to work in Asia. According to identify economic opportunities and to be as effective the same poll, only one-third of respondents felt that as possible in pursuing them. And if these investments the Canadians working in their professions had adequate in Canada’s ‘Asia competence’ are to yield pay-offs knowledge of Asian societies and economies. Sending soon, we must begin the process of introducing and Canadian students to Asia is an effective way to fill this strengthening relevant programs now. skills gap. ■ Labour Force: Canada’s future workforce will rely ■ Education System: Amidst capped domestic tuition, heavily on immigrant skills. Today, 75% of labour international students provide important revenues growth comes from immigration, a share expected to that schools need to expand their academic programs. reach 100% before the end of the decade. Indeed, by Moreover, research and faculty links between Canadian 2020, our economy is projected to face a shortage of and foreign institutions boost our universities’ skilled labour in sectors as diverse as health, finance reputations, help them attract prestigious projects and and applied