Enhancing China's Competitiveness Through Lifelong Learning ...

Challenges to China’s Education and Training System and the New Global Context 3
and skills. Schools and training institutions thus need to prepare workers for lifelong
learning. Educational systems need to put more focus on developing decisionmaking
and problem-solving skills and teaching people how to learn on their own
and with others.
This change poses serious challenges to China on two counts. One is the stock
problem—how to provide massive training to the world’s largest labor force with
relatively low educational attainment. The second is the flow problem—how to
upgrade the quality of the educational system to give new cohorts going through it
the skills necessary to compete in the knowledge economy.
All these changes call for a new and more effective model of education and
training—a model of lifelong learning. The rest of this chapter will summarize
some of the key global trends in education and training and why investments in
education and training are important. The next chapter will lay out why it is important
to develop an effective system of lifelong learning to cope with the changes.
Global trends in education and training
The total global education and training market, at about $2.3 trillion, is growing
rapidly. 3 In total spending, about a third of the market is in the United States, only
15 percent in developing countries. In numbers, the large majority of persons studying
or receiving training is in developing countries.
The total number of students in primary and secondary education worldwide
was 1.2 billion in 2002, the total in higher education in 2002 was 100 million, 4 and in
2005 110 million, with China responsible for 70 percent of the increase. 5
The new trends include the following:
• Education as a source of competitive advantage and social participation.
Investment in human capital is critical for economic competitiveness and
growth. With rapid advances in knowledge, technology and skills are becoming
the key drivers for development. Evidence shows that the link between
education and economic growth strengthens as the rate of technology transfer
increases, suggesting that technology adoption is strongly linked to the
education of the labor force. The threshold level of human capital accumulation
beyond which a country may experience accelerating growth is estimated
at a literacy rate of about 40 percent. Once countries reach this level,
they can increase growth by opening their economies to technology transfer,
as Costa Rica has done (World Bank HDNED 2002). Education also has an
important effect on civic participation and social cohesion. More-educated
citizens are more likely to participate in the political process and contribute
to social development. For these reasons, most OECD countries have
increased their public expenditures on education (table 1.1).
• Higher enrollment rates, especially in higher education. As the economy
and industries increasingly shift toward knowledge-intensive directions, the
3. It is estimated by the authors that the market is growing at about 10 percent a year.
4. Authors’ calculations based on the most recent data available from UNESCO Statistical
Institutes, http://stats.usis.unesco.org/TableViewer/tableView.aspx (accessed February 2006).
5. Estimates by Ron Perkinson, International Finance Corporation (IFC), at IFC Higher Education
Forum, February 2006.