|Buffett and Gates give the thumbs up to China|
Not only do the schools lure these students to go overseas, but also set up satellite campuses in the respective home countries to make it easier in terms of visas and prices. It is also a way to brand the school, and give it a presence in Asia.
School administrators were at pains to explain they were trying hard to provide high quality education especially overseas as they were presenting a brand, a product, and so standards needed to be kept high to meet expectations. There was no mention of tuition prices, but it was hinted competition was stiff on terms of getting students.
Even Malaysia has designated an area specifically for satellite schools and hopes to create an education hub for the southeast Asian region. As one science researcher said, she hoped Malaysian students studying at home will stay there and help benefit the research sector by inventing new products or discovering breakthroughs in science for the country than for those overseas.
In the end there was no real conclusion except going global for education is an ongoing trend that will continue to flourish as long as people in Asia prize a western education. By the same token it's up to the schools to keep their standards up otherwise they will lose students to their competitors.
Another documentary by CNBC followed Bill Gates, Warren Buffett, his right hand man Charlie Munger and another on the board of Berkshire Hathaway on their trip to China last September. It literally followed them on Buffett's private jet which started from Omaha, Nebraska, then flew to Seattle to pick up guests like Gates, then on to Anchorage for refueling before arriving in Shenzhen.
As Berkshire Hathaway has a 10 percent stake in BYD or Build Your Own Dreams in its bid to build electric cars, they were keen to see the factories themselves and give a boost to the company. And everywhere they went they were chased down by the media, eager for any financial advice Buffet would give them. There is the added angle that Li Lu, one of Buffett's advisers was a former student leader during the Tiananmen massacre.
While on the trip, Buffett gamely hammed it up for the photographers and did some CCTV interviews. At the time they believed BYD had lots of potential to grow and felt its stake in the Chinese company is a long-term investment. However with the recent problems with many Chinese companies listed in the United States, Buffett may be privately reconsidering his heavy stake in BYD, but at the moment isn't saying much about the situation, even though the battery company's stock isn't doing so well.
The other goal of the trip was to talk to the uber rich about philanthropy. There was a lot of hoopla surrounding the event which was held in a quasi French-looking chateau in the outskirts of Beijing. It was strictly invitation only and when Buffet and Gates tried to talk about philanthropy and wanted to encourage others to pledge most of their wealth to charity, it mostly fell on deaf ears. Only one or two tycoons actually made some kind of earnest pledge. The rest seemed to only be there to take advantage of the photo opportunity with two of the richest men in the US.
After the event Gates and Buffett tried to play down the event, saying they were not twisting anyone's arms to donate their money, and they learned many things about the philanthropy situation in China. For example, there are no extensive charity laws in place so that companies and individuals can get tax breaks on their donations; Gates and Buffett were strangely unaware this issue existed.
They also didn't seem to realize that while China has a growing millionaire population that is on average 15 years younger than those in the west, how wealthy Chinese got their money in the first place is questionable which is why they don't want to draw attention to themselves. Probably the majority of these nouveau riche made their money through shady means and are keen to launder their wealth in real estate, fast cars, jewellery and fine art.
It remains to be seen if BYD will be one of Buffett's star investments, but in the meantime he and Gates need to brush up on their knowledge of how the rich really get super rich in China.