Universities fear trade talk ploy will backfire

February 22, 2002

The United States government has quietly proposed a change in trade policy that non-profit universities say will favour their for-profit competitors, making it easier for them to offer distance-education courses to students outside the US.

The proposals, part of the ongoing General Agreement on Trade in Services negotiations, would "help create conditions favourable to suppliers of higher education, adult education and training services by removing and reducing obstacles to the transmission of such services across national borders", the US Trade Representative's office said.

American officials complain that other nations restrict the use of satellite dishes and impose barriers on the import of higher education, including discriminatory taxes and limits on the number of instructors that can be foreign nationals. They want foreign governments to allow the delivery of higher education services over the internet and by video and audio transmission.

But representatives of traditional not-for-profit universities in the US say changing the rules would give their for-profit competitors an advantage.

"We don't think we have that much difficulty gaining access to the rest of the world," said Terry Hartle, senior vice-president of the American Council on Education, an association of primarily not-for-profit universities and colleges.

"We don't think we have big trade problems. We don't see a lot of barriers that prevent us from getting into foreign countries if we want to. The for-profits do see a number of barriers."

Because the proposals would be reciprocal, Dr Hartle said, US universities feared there would be unintended consequences. Public universities, for instance, which charged a lower tuition to students in their home states, might have to offer the same low rate to international students, he said.

"There's no question that the US remains a strong magnet for international students," Dr Hartle said. "Our reservation is not with lifting the barriers. Our concern is that we don't understand, and we don't think the US Trade Representative understands, what the implications of that would be."

He said pushing for US for-profit higher education companies to have more access to foreign markets may also backfire. "What foreign universities think when they look at American higher education is that our for-profit providers could McDonaldise their higher education," Dr Hartle said.

Government officials have agreed to meet Dr Hartle and other university representatives before their June 30 deadline to make proposals to the World Trade Organisation.

"If there's any nation in the world that has nothing to fear from competition, it's higher education in the US," Dr Hartle said. "But the last thing we should be doing is harming an industry that has a positive balance of trade."

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