Some shareholders of Dulwich College International are in discussions about selling the British school’s operations in Asia, which are heavily focused on China, according to two sources. This development highlights how the turmoil in China’s $570 billion education industry is prompting institutions to make significant changes. Industry executives have revealed that numerous international and private schools in China are closing or merging due to tighter regulations, a slowing economy, and a decrease in foreign student numbers. The sector’s troubles began with Beijing’s implementation of new rules in 2021 and its crackdown on the private tutoring business, aimed at reducing pressure on children and lowering costs for families. The challenges have been exacerbated by three years of the pandemic and slowing economic growth. Julian Fisher, the managing director of Venture Education, a Beijing-based consultancy specializing in China’s education sector, stated that the sector is either in terminal decline or going through growing pains, depending on one’s perspective. Dulwich College International operates nine schools in China, including bilingual schools catering to Chinese nationals, which have been hit hardest by regulatory changes. The company has also scaled back its strategic plans for the growth of its high schools in China in response to changing government regulations. In response to queries about a potential sale of its Asia business, Education in Motion (EiM), the owner and operator of Dulwich College International schools in China, South Korea, and Singapore, said it was in the process of bringing in a new financial partner and that the refinancing process was planned and not connected to regulatory changes. The Chinese government considers schools to be crucial in its strategy to enhance the country’s self-sufficiency in science and technology and achieve the “great rejuvenation of the Chinese nation on all fronts.” In 2020, there were approximately 180,000 private education institutions in China, accounting for over a third of all education institutions in the country, with 55.6 million enrolled students. However, international schools, which can only enroll students with foreign passports, have experienced a decline in student numbers due to expatriates leaving after the pandemic and amid rising geopolitical tensions. Beijing’s crackdown has further intensified the pressure on international schools. The government mandated that Chinese compulsory education be taught in private schools, aligning the curriculum more closely with public schools and causing parents to question the need to pay private school fees. Additionally, authorities have taken steps to control the number of private schools, and recently, China’s legislature passed a law to strengthen patriotic education in schools. Many schools, from kindergartens to high schools, have closed or stalled in the past two years. Geopolitical tensions have also contributed to concerns about an English language vacuum, making China more inward-looking. The number of American students in China has dropped significantly in recent years, but there has been an increase in students from Belt and Road countries. As a result, education companies, including bilingual and international school operators, have been considering selling their assets in China. The future of expatriates in China is expected to be less focused on traditional Western countries.
Private schools reconsider their future in China following poor growth performance
