Australian universities and the age of geopolitics
The world in disarray
In nine short months, three of America’s most revered universities have lost their heads.
In December 2023, Professor Liz Magill, president of the University of Pennsylvania abruptly resigned. Four weeks later, the leader of the world’s top ranked and most prestigious university – Harvard’s Professor Claudine Gay followed suit. In August this year, less than twelve months into her tenure, Professor Minouche Shafik resigned as Columbia University president.
Their departure was forced by the backlash to their response to the Israel-Hamas war and the student protests, which gave rise to both anti-Semitic and Islamophobic sentiments on their leafy campuses. Under pressure from politicians, donors, students, staff and media, unable to reconcile deep-seated ideological and political differences and highly emotional responses to the immense suffering in Israel and Gaza, these highly-accomplished university leaders and women were forced to step down.
Amplified by social media, the wave of protests spread far and wide, including Australia, where camps were set up on campuses of some of Australia’s most prestigious universities. And while the scale and ferocity of the Australian rallies were far smaller compared to the United States, their aftermath still reverberates, as seen in the recent apology by the University of Sydney’s Vice-Chancellor Mark Scott to Jewish students for "failing them" in his management of a pro-Palestinian student encampment on his campus.
Universities worldwide are facing a dramatic confluence of global and domestic challenges that are testing their reputations as bastions of free speech, threatening to undo decades of growth and upending their operational model.
Since the start of the 1990s the flourishing global demand for higher education has unleashed unprecedented student mobility, commercialisation and growth of higher education. But as this decade’s geopolitical tensions, economic fragmentation, and cultural and political divisions deepen, Western universities find themselves on a back foot. They are forced to manage more competitive student markets, their national governments’ increasingly protectionist and populist policies, while at the same time responding to a once-in-a-generation technological revolution challenging the very model of university education.
Universities mean business
Australian universities have been the greatest beneficiaries of globalisation and deregulation. In fact, Australia has played a pioneering role in the internationalisation of universities world-wide and has built a remarkably successful international higher education powerhouse. Australia’s international education industry – our fourth largest export sector in 2024 – has been fuelled by the demand for overseas degrees from the burgeoning middle class in Asia, the universities’ highly entrepreneurial international education culture and a favourable regulatory regime, deeply linked with immigration policy.
An inherent tension between running a large global business and a local public sector institution could not be starker.
But our universities have fallen victims to their own success. As international student revenue steadily grew, the government’s funding of universities declined – creating a system that is dependent on international income to support domestic demand.
In a country where local corporations rarely venture overseas, Australian universities have built an extraordinary global market presence, recruiting students en masse directly and through networks of intermediaries and delivering their courses through local offshore partners and satellite campuses around the world, predominantly in Asia.
As a result, Australian universities today have a dual personality. On the one hand they are self-regulating public institutions, deeply embedded in their states and expected to educate and support their local students and communities. On the other – most metropolitan Australian universities are large international businesses employing thousands of staff, offering complex, high-value education products for thousands of domestic and international customers – often in offshore locations and through local franchises, and managing large property and investment portfolios.
If some of Australia’s largest universities were listed on the Australian Stock Exchange, they’d probably be among the top one hundred of our largest companies. An inherent tension between running a large global business and a local public sector institution could not be starker.
These tensions were manageable in the last three benign and prosperous decades. But as global fragmentation, competition and geopolitical tensions start to gather pace, the model has started to unravel.
Fortress Australia?
First, in 2017 Australia’s push-back against China’s political, economic and community interference and coercion led by the Turnbull government revealed Australian universities’ vulnerabilities to China. Exposed were sensitivities around joint research, particularly in the areas relevant to national security and critical technologies, a high reliance on income from Chinese enrolments, and China’s political influence on campuses through student associations, the Confucius institutes and philanthropic donations.
Then came the global pandemic that closed Australian borders, thus emptying Australian campuses from new international students. As borders re-opened, the flood of students returned.
While policymakers and some vice-chancellors called for a reset of Australia’s international education industry towards a more sustainable model, these calls have drowned in the sea of new enrolments and revenue.
Australian universities are exposed to the three forces of this decade’s geopolitical upheaval – fragmentation, protectionism and technology-driven divisions on values.
In 2022, the Albanese government was elected with a mandate to build Australia’s economic and security resilience. Its agenda is focussed on making the Australian economy more secure and sovereign through its signature “Future Made in Australia” - a combination of industry policy, trade diversification and economic security initiatives.
In foreign and defence policy, Canberra has pursued an even deeper enmeshment with the US alliance system to counter China’s growing power in Asia, while investing in our domestic defence capabilities. At the same time, Canberra has successfully stabilised the diplomatic and economic relationship with Beijing and removed most of the trade impediments unfairly introduced by China in 2021. The Government has also lifted its engagement with South-East Asia and the Pacific.
The Government has also sought to better align regulatory, science, education and economic policies and institutions to improve our innovation capacity and productivity. Canberra wants universities to be a part of its strategic policy agenda, and for vice-chancellors to be more focussed on what it sees as urgent national priorities.
The powerful new university regulator – the Australian Tertiary Education Commission (ATEC) will be a major instrument in Canberra’s toolkit to claw back some of the oversight of the Australian university system.
Domestically, the Government has been under pressure to curtail migration to address housing shortages and ease the cost-of-living crisis. With federal elections on the horizon to be fought over housing, immigration and cost of living, the government picked a target which has surprisingly weak political influence and fragmented constituency - Australian universities.
By linking the housing crunch with international students, the government first introduced tighter visa regulations and considerably increased visa processing fees for overseas students. It has followed with a policy of capping international student enrolments for 2025 (yet to be passed by Parliament). While these moves were largely driven by politics, and the implementation has been clumsy, it nevertheless sent a message to the university chiefs that the business of international education cannot continue as usual. The sector’s response was far from united. Most sandstone metropolitan universities with high numbers of international students have come out vehemently against the caps, while smaller, regional universities are more supportive of the new policy.
The universities’ political message against caps – in one breath portraying international students as an export commodity, source of investment and talent, public good and diplomatic and ‘soft-power’ asset – was far too complex even for the most sympathetic politicians, let alone for the sceptical public.
The travails of the universities’ relationship with China, international student caps and visa curbs, and to a lesser extent the contest for freedom of speech, brought to the surface by the Gaza protests have shown that Australian universities are exposed to the three forces of this decade’s geopolitical upheaval – fragmentation, protectionism and technology-driven divisions on values.
How our institutions respond to these challenges will determine our universities’ success and relevance in the new age of geopolitics.
A world of churn and change
It’s not for universities alone to navigate this new era. The scale of geopolitical, technological and societal change which we are witnessing is unprecedented. The world Australia is facing today is fragmented, competitive and more prone to conflicts. The US-China contest is the defining feature of the 21st century. Unlike many of its regional neighbours, Australia finds itself deeply embedded in the US camp in the global competition between Washington and Beijing. We are a part of America’s multipronged, bipartisan and multigenerational strategy to stay on top of the international power ladder in technology, defence and economy, including the industries of the future.
Australia’s response to this new environment is building a “Fortress Australia” – aligning even closer with the United States and its partners, investing in defence and trade diversification, building local manufacturing and renewable energy capabilities and patching supply-chain and technological vulnerabilities. At the same, Canberra continues to pursue an open and independent trade agenda. Australia maintains a dynamic but unpredictable relationship with China – which, despite the Government’s best efforts in trade diversification – stubbornly remains Australia’s largest trading partner.
In many of the new industries - from defence to solar power technologies, from artificial intelligence to electric vehicles, Australia is a start-up, heavily reliant on overseas intellectual property and talent. To succeed, we need to invest in our own capabilities and have a well-funded, high-performing education and research sector which remains open to cross-border flow of talent and intellectual exchanges.
In this new age, fragmentation and competition co-exist with interdependence and openness.
Paradoxically, Australian international education may yet prove to be a strategic asset that we need to thrive in a competitive world. It is possible with two prerequisites. Firstly, there is a broader agreement across wider society that Australian international education (defined broadly to encompass international students, research and global engagement) delivers fundamental benefits to our universities, economy and society at large. Secondly, the sector is sustainable, maintains the highest level of quality and integrity and contributes to our national economic, security and societal priorities.
There is growing evidence that both universities and government understand this dilemma. The changing global and domestic policy environment offers Australian universities an opportunity to reset their international and domestic strategies.
Firstly, international education is a dynamic, rapidly evolving market. The ageing demographics of East Asia, continuous improvement in quality of local universities, the proliferation of new models of higher education delivery and the emergence of ground-breaking technologies in online and hybrid learning suggest that a traditional model of mass recruitment of international students to study onshore in Australia will in the next two decades be unviable. The pioneering Australian universities - Monash, RMIT, Melbourne, Deakin and others - have been strengthening and diversifying their transnational partnerships and offshore programs to be ahead of that trend. In one of her recent speeches, Foreign Minister Penny Wong reprimanded Australian companies for not investing in South-East Asia, despite the Government’s ambitious South-East Asia Economic Strategy. Ironically, it is the Australian universities – Monash, Deakin and the University of Western Sydney - that have shown a greater risk appetite than Australian firms and have established presence in Indonesia, betting big on the country’s younger demographic, growing demand for higher education and conducive policy environment.
Secondly, Australian universities must reclaim their ground on policy. The sheer scale of the geopolitical, environmental and technological change requires greater contestability of policy and disciplined evidence and data-based decision-making. Such expertise cannot always be found in our public service which still favours a generalist workforce, or consulting firms operating on shorter timelines and driven by commercial considerations. Our universities are treasure troves of expertise on the most complex policy and technical issues – from technology governance to biodiversity. Yet very few of our institutions systematically and strategically engage with the government on the core policy challenges of our time – climate, national security or technology. Except for the Australian National University and university-affiliated think-tanks, such as the US Studies Centre at the University of Sydney and Asialink at the University of Melbourne, deep policy engagement is rare or led by individual academics. One problem is the ever-tightening government protections of sensitive information and data. Another is a limited flow of talent between government, industry and universities. But more importantly it’s a lack of culture of policy engagement between universities and government. The Government must find a balance between information security and vital external expertise needed to shape, test and implement policy. Universities need to build their policy outreach capacity and prioritise policy engagement as a core pillar of their national mission or risk being left on the margins of policymaking.
Having built an incredibly successful international education economy, Australian universities now need to find a balance between their national, global and institutional obligations and aspirations.
Thirdly, a meteoric rise in global defence spending and Australia’s own burgeoning defence sector offers enormous commercial and innovation opportunities to Australian universities. Some of Australian institutions, such as UNSW, Deakin and Adelaide, are already defence research powerhouses. The scale and complexity of the AUKUS partnership alone will require an unprecedented collaborative effort between governments, industries and universities in Australia, US and the UK. Australia’s fundamental weakness is talent required to deliver on the AUKUS ambition, and universities have a vital role to play in developing our domestic workforce, as well as attracting the best minds from abroad. AUKUS also opens an opportunity for even deeper collaborations with the world’s number one security and technology ecosystem – that of the United States.
Fourthly, Australian universities must lead on Asia literacy. Since the 1980s, Australia has been making a case to itself for investment in Asia literacy across all levels of our education system. Yet, the teaching of Asian languages and studies in our schools and universities has continued to decline. Anecdotally, the most impactful recent gains in improving our national Asia intelligence have largely been made by and through our own Asian-Australian community as well as scholarship programs such as the New Colombo Plan and the Westpac Asia Exchange. But the need to understand our region – the centre of the world’s economic dynamism and its most consequential geopolitical contest - has never been greater. Our universities must look beyond the immediate difficulty of translating Asia skills and research expertise into graduate employment and funding outcomes and invest in teaching and research of Asia as part of their public-service contribution to Australia’s future. Asia literacy is a matter of national interest which will pay significant future dividends. It is also the area of expertise our government tends to seek externally – to test their analytical and policy assumptions about our region. Offering such expertise will add value to the universities’ policy engagement capacity.
Finally, as hard as it is in the current geopolitical environment, Australian universities must continue to engage with China. China is and will remain a science and research powerhouse – including in the technologies and industries that Australia wants to develop, such as renewable energy or advanced manufacturing. China’s demand for higher education will also continue to be strong and it will remain a net exporter of talent – including to Australia. Importantly, Australia and China have over decades built a remarkable education and research relationship. It was the universities that led Australia’s re-engagement with China following the establishment of diplomatic relations in 1971. Some of the best minds in our engineering, science and medical faculties are Australian-Chinese scholars and Chinese alumni of our universities. As counterintuitive and problematic as it may seem to suggest engaging in research with both the United States and China, it is not a zero-sum game. With the right leadership, policies and controls, Australia can and must do both.
The age of geopolitics will have a profound impact on Australia. Our universities are not immune from the shocks and tribulations of a fragmenting but deeply interconnected world. Research collaborations across the fault lines of geopolitical rivalry will be harder to manage. Global student flows will be subject to more interventionist and protectionist policies of national governments. Managing the politics of national loyalty and allegiance will be harder as societal divisiveness and securitisation of economy and politics intensify. Our gut instinct will be to withdraw and play safe. But for Australia - a G20 economy and an activist global diplomatic player reliant on international markets and alliances for its prosperity and security, retreat is not an option. Having built an incredibly successful international education economy, Australian universities now need to find a balance between their national, global and institutional obligations and aspirations. To avoid the breakdown of trust we saw on American campuses this year, our universities will also need to keep making their case for social licence again and again to their diverse constituencies.
Australian universities face what Australian Treasurer Jim Chalmers described as “a world of churn and change”. A resilient and cohesive “Fortress Australia” which remains open to international trade, talent and ideas needs a “Team Australia” that is educated, innovative and globally minded. Our universities have a fundamental role in building this team.
This is a full version of the paper presented at the Australian International Education Conference, 23 October 2024, Melbourne, Australia. An abridged copy of the paper - “Australian internationalisation must be rethought – but not abandoned” was published by The Times Higher Education on 23 October, 2024.
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