Dozens of international and private schools in China are closing or merging, industry executives said, weighed down by tighter regulation, a slowing economy and dwindling foreign student numbers, Reuters reports.
The agency reported that two sources had said some shareholders of Dulwich College International are in talks for a sale of the school’s China-heavy Asia operations. It is the latest indication of how turmoil in China’s $570 billion education industry is forcing overhauls at institutions.
A rapid expansion prior to the Covid-19 pandemic drove a surge of privately run bilingual schools in China offering a western exam curriculum. But the business stumbled as Beijing imposed new rules in 2021 and cracked down on the private tutoring business, aimed at easing pressure on children and lowering family costs.
Three years of the pandemic and slowing economic growth have exacerbated the challenges, said Julian Fisher, managing director of Venture Education, a Beijing-based market intelligence consultancy specialising in China’s education sector.
“The cynic would say the sector is in terminal decline, the average Chinese investor simply that it’s going through growing pains,” said Fisher.
Dulwich College International operates nine schools in China including bilingual schools catering to Chinese nationals that have been hit hardest by regulatory changes. Besides China, Dulwich International also has schools in Singapore and South Korea.
Strategic plans for growth of its high schools in China were “scaled back in light of changing government regulations”, Dulwich said in its 2022 annual report.
In a response to Reuters’ queries about a potential sale of its Asia business, Education in Motion (EiM), which owns and operates Dulwich College International schools and high schools in China, South Korea, and Singapore, said it was “in the process of bringing in a new strategic financial partner”, adding the process would also allow partners to exit their investments in the group.
It said it was a planned process of refinancing and “not connected to regulatory changes in any market”.