English universities and colleges based overseas are teaching one in six of all registered students, figures from the higher education watchdog have revealed.
An investigation by Office for Students into the scale of transnational education found students living overseas now account for 16 per cent of all of those registered at English institutions.
In 2021-22, 146 English universities and colleges had 455,000 students in other countries. China had the highest proportion, with 61,505 students – or 14 per cent of the total.
Twenty-seven per cent of students abroad were taught by overseas partner organisations and a quarter were taught by distance, flexible or distributed learning.
Six per cent studied at overseas branch campuses of English universities, with the remaining 42 per cent covered by other arrangements, including collaborative provision, according to the Office for Students report.
Transnational education constitutes an increasing proportion of the teaching of many English universities to “an increasingly significant income stream”, the report says.
The watchdog engaged with seven English universities in July last year to learn more about how they ensure high-quality education is delivered overseas.
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Open University accounted for the largest population of students (46,300) overseas in 2021-22 – which equates to 10 per cent of the total transnational education population.
The University of London came next with 37,400 students (8 per cent of the total) in 2021-22, followed by Coventry University with 21,400 (5 per cent).
“As transnational education continues to grow, an increasing number of universities and colleges are seeing it as a component of their plans to diversify and grow their income,” Jean Arnold, director of quality at the Office for Students, said.
“Our regulatory remit is not limited to students located in England. It is important that students studying outside the UK are confident that their course is of the same high quality as would be the case if they were studying in England.
“Transnational education is a vital and thriving part of our higher education sector. By underlining that it is robustly regulated to ensure quality we intend to maintain and enhance the reputation of English higher education at home and across the world.”
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Nick Hillman, director of the Higher Education Policy Institute think tank, told The National: “Not everyone wants to move to study and not everyone can afford to do so.
“Transnational education allows people to get a trusted UK qualification without leaving their home.
“No one should assume that other students will stop wanting to come here to study because of the growth in TNE [transnational education].
“All the forecasts I have seen assume there will be further growth across the world in regular international students, who cross borders to study, as well as additional growth in transnational students.”
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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