Tackling China’s Achilles Heel

China’s rapid rise to the status of global superpower over the last three decades has come as no surprise to anybody, with most experts predicting its wealth will exceed that of any G7 nation by as early as 2030 – and when the strong spine of its economy is considered, it’s not difficult to see why. The transition to a market economy that began in the late 1970’s has at last enabled the world’s largest labour force to properly harness the potential for growth that comes with huge abundances of natural resources such as coal, iron ore and natural gas. Between 1978 and 2008, China’s annual GDP growth averaged an exceptional 9.5 per cent, without dropping below 5 at any point since 1990. Even during the recent global financial crisis, there have been no signs that this trend is set to falter after the latest figures showed a rate of 7.4 per cent for the third quarter of this year, further highlighting the resilience of recent progress.

By the 1990’s it became clear that despite success in terms of growth, manufacturing and export figures, if China was to genuinely compete with Europe and the Americas in the long term, it must address its long-standing Achilles heel: education. A literate and numerate workforce is, in the modern day, an absolute bare minimum in building the foundations for prosperity in generations to come. For centuries the world’s most gifted professionals in all industries – including scientists, writers, engineers, doctors and entrepreneurs – have emerged from the Western world, and this is no coincidence; an emphasis on providing youth with a good education has long been considered a non-negotiable necessity, and as such, investment in human and fiscal capital has been unrivalled by Asian competitors. Teaching standards have been consistently higher and the public funding of schools and universities also far greater, so it’s perhaps to be expected that China should have a lot of catching up to do. But in defence of the government, it appears that they are well aware of the need to deliver change – and all evidence from the reforms of the past twenty years suggests that they will succeed.

The first problem that the reforms have had to overcome was the astonishingly low enrolment rates in schools, particularly in the more rural regions of the west. In 1952, less than half of China’s children of school-starting age actually enrolled at primary school – meaning a majority of the population was growing up with no formal education whatsoever, severely limiting the number of skilled workers in the economy. The government eventually responded to this issue by introducing the Compulsory Education Law in 1986, which finally ensured that local authorities were legally obliged to provide education for children. This was expanded in the 1990’s to require a minimum course of 9 years in school for every child. The impact of this reform was incredible; by 1995, enrolment in primary and secondary schools increased to rates of 98.5 and 78.4 per cent respectively, and by 2007, these figures had increased further still to 99.5 and 98.0. Enrolment rates like these are 12 points higher than the global average, and are actually very similar to figures seen in many European nations, demonstrating, if nothing else, that China has at last begun to hold education in the high regard that it needs to in order to be competitive.

Although an increased school enrolment rate was in itself a success for the government’s reform programme, it also created a new problem in the form of a funding gap. More pupils required more teachers, books, materials and so on – but public spending on education did not increase accordingly. In 1990, China was spending just 2.2 per cent of its GDP on education, and over the following ten years, this figure dropped to as low 1.9 per cent. As a result, the standard of teaching and overall quality of education remained very poor. Pupil-to-teacher ratios in Beijing hovered at around 25 for most of the decade, whilst just two-fifths of those teachers were sufficiently trained, and the situation would have been far worse in the countryside. In recent years however, it again appears that the government has succeeded in tackling this key problem, as 2006 reforms ensured that children from less wealthy backgrounds could attend school without paying any fees for their tuition or for their books, with these costs being paid by the state instead. Following this, public spending has now doubled since 2000, with 4.6 per cent of GDP now going towards education. Standards have greatly improved; books and materials are much more easily accessible and pupil-to-teacher ratios have dropped by one-third to 17. In just twenty years, China has gone from having a minority of children receiving a fairly poor education, to having virtually all children receiving nine years of quality, well-funded schooling.

Early signs suggest that the reforms to schools are already bearing fruit; in 1985, the year before education became compulsory, the adult literacy rate stood at a mere 77.8 per cent. Post-reform statistics show a remarkable improvement, as the literacy rate in the current generation of 15-24 year olds is 98.9 per cent, meaning that in just a few decades time, illiteracy will be all but completely eradicated from the labour force. The basic foundations for producing the kind of skilled professionals that China’s government and economy crave are effectively now in place, but one area that is still in need of further reform is higher education.

In universities, it’s again the quality of education that is preventing the strongest students from reaching their potential, or worse, encouraging them to emigrate to study at the more prestigious establishments in the West. The system is dominated by a heavily regulated top-down approach, which most teachers and students agree is causing a situation where classes are centred around memorising facts and preparing for exams, whilst neglecting the nurturing of useful skills and stifling original thinking. For China to make the next leap from producing a basically educated generation leaving school to producing one filled with skilled professionals, this is the final transformation that it needs to undergo.

Once again, the government has responded. Two years ago, a decade long programme for reform was unveiled, including plans to allow universities and colleges greater autonomy, a move to a more all-round assessment of students and a more relaxed attitude to exams. On top of this, plans to greatly increase public funding of universities have also been announced. The success of these reforms could play a major role in determining the future direction of the Chinese economy – if it fails, it could be decades before it can compete with the likes of the UK, Germany and the US. If it works, it may just prove to be the final missing piece of the jigsaw, providing an influx of talented young individuals who can carry the nation forward, and secure sustainable economic growth for the long term future.

One response to “Tackling China’s Achilles Heel”

  1. Interesting and well researched take on an underreported issue. With regards to the improvements to tertiary education, to what extent can this improve the complexity of China’s manufactures or increase innovation in the country? Is it simply a case of improving this area, or are other areas to explore?