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Universities: Key Players in the Global Economy

Address to the Conseil des relations internationales de Montréal
Prof. Heather Munroe-Blum
March 10, 2008

 

Dear colleagues and friends,

I am delighted to speak to you today as Principal of McGill University. Although I am not here on behalf of the Conférence des recteurs et des principaux des universités du Québec, I want to say how honoured I am to serve as its President.

As many of you know, since I returned to Montreal, I have embraced this city’s great cuisine and colourful clothes, and have gladly traded my customary handshake for the two-cheek kiss. Today, like any true Montrealer, I would like to speak to you about passion: a passion for knowledge, a passion to excel, a passion to succeed and a passion to share.

Passion informs my words today – a passion that universities have a key role to play in giving Quebec and Canada the truly competitive economic climate that all of us want.

Quebec is blessed with a strong and diverse university system – from remarkable regional institutions to internationally recognized research-intensive universities. Each plays a vital role in making the province competitive nationally and internationally.

Montreal’s four distinguished institutions make it Canada’s first city in university research. Together, we attract investments of $1.1 billion per year. According to the prestigious London Times Higher Education Supplement, Montreal is one of the few cities in the world with two or more universities in the top 100. McGill, for instance, is ranked #12 in the world.

Research universities in a new world

I would like to step back for a moment and look at some of the stunning changes that have taken place in our world over the last few decades:

  • The emergence of an integrated global market in which international networks and partnerships have become the life-blood of the economy;
  • The creation of a world that is linked by instantaneous 24/7 communication; and
  • The proliferation of industries based on knowledge and talent even in world industries formerly based primarily on raw materials and manufactured goods.

At the heart of globalization is a tension between the local and the global – and a fear, perhaps, that we are losing something, while others half-way around the world may be gaining.

For Quebec, the dilemma is this:

  • Can a province of seven-and-a-half million people compete and win in a world market of more than six-and-a-half billion?
  • Will we be recognized as leaders on the world stage, or will we be lost in the shuffle?
  • Can we preserve our identity, or are we facing a process leading to cultural conformity?

The dynamics of globalization have changed the rules of the game. And this can be frightening or inspiring, depending on where you sit.

Here is what I believe:

Strong universities, with targeted areas of expertise, must be a cornerstone of a region’s competitive strategy. To succeed locally, regions must identify and develop distinctive clusters of excellence that are recognized as offering important value globally. If you make the right choices and execute effectively, the world will come to you. These clusters will attract new international investment and an increasingly mobile pool of talent.

In this new arena, top universities can be powerful forces. They attract financial and intellectual resources from the four corners of the Earth. They provide the expertise and ideas to nourish the clusters that make the city and regional economies internationally competitive.

We are not going to generate revenues or win gold medals by making the same products and providing the same services as everyone else. Only by adding value will we make our mark. The creativity to imagine these things, the knowledge to design these things, and the partnerships that will market these things, more often than not, will emerge from our universities. Highly educated people, with the capacity and drive to innovate, are the key to our future prosperity.

Everywhere I go around the world, our graduates tell me wonderful, touching stories about how they fell in with the love of their life at McGill. And while important, to be sure, romance is not the only important offshoot of life on a university campus. Research universities are also unparalleled at providing passion for knowledge and creating international talent networks:

  • A student from Montreal and a student from Madrid begin a friendship that later morphs into a successful business partnership.
  • A newly-minted MD goes to work at Harvard and continues to collaborate with her McGill supervisor, bringing new research impacts and health care solutions to Montreal.
  • An exchange student from China adores with Montreal and decides to do his graduate work here. He then goes on to start a new investment firm, bringing talent and money from elsewhere to invest in enterprises in Montreal.

Simply put, universities act as matchmakers to link smart people -- across the city, the region and around the world. They connect the local and the global for mutual benefit. A passion to know becomes a passion to succeed and the university is most often the catalyst.

McGill as an international institution

Before addressing how universities can rise to the challenges of our globalized world, I would like to talk about the groundwork we have been laying at McGill. Each of my fellow rectors would have their own compelling story to tell about the distinctive assets of their university. Let me tell you about McGill’s.

McGill is one of Quebec’s six most internationally recognized brands. The others are Bombardier, SNC Lavalin, Hydro-Québec, le Cirque de Soleil and Céline Dion. Well, OK, I will admit that it is humbling to rank behind Céline Dion. But just like Céline, McGill represents Quebec – and Canada – to the world.

Like Montreal, McGill’s strengths lie in its mixture of the local and the global. Approximately 55 percent of McGill’s 33,000 students come from Quebec, of whom over 6,000 are Francophones; 25 percent come from the rest of Canada and about 20 percent from over 150 countries around the globe.

In fact, we have amongst the highest percentages of full-time foreign students of any university in North America. Our strategy to attract the best in the world – in our key areas of strength – has brought almost 800 new professors and their families to Montreal in the last eight years – and almost 60 percent of these new professors have been recruited from outside Canada.

Our approximately 200,000 living alumni across 180 countries help us open doors to new academic, governmental, cultural, service and business collaborations that benefit Montreal, Quebec and Canada. Our alumni mentor students. They provide strategic advice, and they give generously. At least I hope they do. In McGill’s current $750 million fundraising campaign, we aim for more than half of the money raised to flow into Quebec from outside the province. McGill brings philanthropic dollars into Quebec, along with the social, economic and intellectual contributions of our new professors and their families, and almost half-a-billion additional dollars in competitively-allocated research money and student fees. In addition to this, of course, are the great contributions that flow into Quebec via our remarkable teaching hospitals.

Our global perspective and impact have become defining characteristics of McGill. And within McGill there is an informal grassroots internationalization that plays itself out every day in residence computing stations, in community projects, in faculty lounges and on the hockey rink.

When a student trades ideas with a classmate who has worked with refugees in Africa, it brings alive the importance of international human rights in a way a textbook could never do. Yes, we are proud of McGill's international reputation because as a Quebec university it also reflects on Québec's reputation and its opportunities in all four corners of the world. Our international mission makes a difference for those graduates and their countries because those who return home can pursue their passion in their own regions with the tools they have acquired here. But we are keenly aware that our ability to compete on the world stage is at risk.

A knowledge city?

Historically, Montreal parlayed its location on the St. Lawrence River into economic prosperity. But we are now in a post-geography era, and we must confront this. What happens when geography ceases to be the primary determinant of one’s economic future? What happens when one can no longer rely on our traditional sources of prosperity?

First, we must diversify. The currency of the new economy is knowledge – and the skilled and entrepreneurial people who produce it. In this respect, Montreal still possesses many competitive advantages. The only French-speaking major metropolis in the Americas, Montreal is also one of the only cities in the world in which a majority of its citizens speak both French and English.

We are known world-wide for great restaurants, music and cultural events such as our jazz and comedy festivals – and also for something else – something ephemeral, but still very present – the joie de vivre woven into the fabric of the Montreal experience.

But our exceptional quality of life also poses a danger to which we must not fall prey: complacency.

In a knowledge economy, innovation and productivity are directly linked to a plentiful supply of highly skilled and well-educated workers. How do we in Quebec stack up? Well, in 2004, the probability of having completed an undergraduate degree was 31 per cent in Quebec compared to 38 per cent in Ontario, and a Canadian average of 33 per cent. Montreal lags behind Toronto, Vancouver and many other major North American and international centres in the rate of our university degree completion. Quebec’s graduation rate is simply too low.

A previous generation of policy-makers thought that low tuition would increase accessibility to universities. But while tuition was frozen, the proportion of the Quebec population obtaining a university degree stagnated. At the same time, degree completion grew in other North American cities and in OECD countries by more than 20 percent. Our policy of low tuition, while well-intentioned, has caused Quebec to lose ground while other nations have leapt ahead. We must look at the facts as they are and not as we would wish them to be.

I challenge all of our leaders who care about Québec and the future of our children – all of you in Quebec’s industries, universities, government, other organizations – including student associations – and parents – I challenge all of us to create and implement a strategy to increase Quebec’s participation and success in higher education. The people of Quebec will be with us on this. In a recent poll commissioned by L’actualité, Quebecers chose education as the top value that the province should emphasize in the future – ahead, even, of the health care system. They were right.

To safeguard our future, we must set a target for increased university degree completion, with hard deadlines for reaching it. Why shouldn’t 38% of Quebec’s young people graduate with a university degree? Why not 60%? This would really make us leaders. Sometimes I dream that the Ontario and Alberta Ministers of Education are calling emergency meetings of their Deputies because more young Quebecers are graduating with university degrees than young Ontarians or Albertans. And they are worried because they know that it’s just a matter of time before Quebec’s growth in the new knowledge economy leaves Ontario and Alberta in the dust.

We – that means every one in this room and many more – need to look with clear eyes at our weaknesses as well as our assets. We are in a global race for talented, educated workers; Quebec cannot afford to drag its feet.

To compete in the new reality, we must resolve to increase our university degree completion rate every single year over the next decade.

The key ingredient to success in the knowledge economy is people: people with a dream and a passion to achieve their dreams. Educating home-grown talent is a vital first step toward building our new economy. But to win, we must look outside as well as within. According to the latest figures, by 2010, Quebec will see a serious shortage of skilled labour – earlier than any other province. By 2030, the shortfall in workers is projected to rise to 363,000. Our universities, and the highly skilled people they attract to our province, are the best means to fight against this looming crisis.

To attract the best minds in the world, Quebec universities must be able to offer the following things:

  • A culturally diverse milieu: Good, Quebec’s got it.
  • An appealing quality of life: Great, we have the best.
  • Top professors and outstanding graduate students for them to work with: Quebec can do far better on this one.
  • An attractive and progressive research environment: our universities and industries need a hand here.
  • Well-maintained infrastructure: Help! This is a big problem. You wouldn’t buy a house with broken pipes and crumbling walls. Well, the people we are trying to attract are smart, and they are not going to attend universities with crumbling infrastructure.

Deteriorating infrastructure is not just about bridges and roadways. More than 30 years of deferring maintenance has left our universities with cracked walls and leaking roofs. And while we applaud the Quebec government’s new infrastructure plan as a necessary first step, we must move quickly and aggressively to fix this problem.

Attracting the world’s best minds

All markets have opened up to worldwide competition – a fact that is true for higher education as it is for natural resources. At a time when knowledge is the most fiercely sought commodity and borders are open, research universities are a golden investment, paying unbeatable dividends in advancing economic growth, reputation, health and social well-being. Because research universities are the passport to the knowledge economy, more countries are developing their own research universities.

China continues aggressively to build a diversified, world-class system of higher education. As part of their national strategies: India, Egypt, Singapore and Japan are all seeking to bolster their research strengths in targeted areas. Governments in the European Union are working together to modernize their university systems. And we are proud to collaborate in building distinguished international knowledge networks with each of these countries. And South Korea, Malaysia, Thailand, Vietnam, Qatar are also entering the race. Unlike some of these countries, we have a great foundation to build on. The unique character of Montreal and our four great urban universities make our city a highly attractive destination for international students as well as international business. About 17,000 students from outside Canada come to Montreal each year contributing over 250 million dollars a year to our city.

Full-time international students, particularly those pursuing graduate studies, are a special asset in building Montreal’s intellectual, social and economic capital. About 30 per cent of our foreign graduate students, and 20 per cent of our undergraduates, settle here following graduation, providing a vital source of the most highly skilled labour, specialized knowledge and global connections.

We must keep in mind that the students who leave also benefit Quebec. Every time an international student moves away from Montreal, she or he creates a new node in a global network. We used to say, “It’s not just what you know, but who you know.” Today, it’s not just whom you know in New York or Paris, but also who you know in Beijing, Bangalore, Bordeaux and Brisbane, to name just the Bs. International students forge crucial connections which can position Quebec as a leading player in the new marketplace. And they carry with them a passion for Quebec and Canada, too.

And although our numbers have been growing, Canada still lags behind the United States, the United Kingdom, Germany, Australia, France and Japan as a preferred destination for foreign students.

To build our economy, we must boost the number of international graduate students studying in Quebec. To compete for the cream of the crop, we must provide substantially more funding for international graduate students.

In its February 26th budget, the federal government announced several measures to bolster higher education and, as a result, Canada’s future productivity and reputation. Among these is the creation of 500 new Vanier doctoral awards, a prestigious $50,000 fellowship that is open to international as well as Canadian PhD students. These are exciting first steps that several provinces are replicating. I hope that in its upcoming budget, the Quebec government will also recognize the importance of investing in higher education, including in international graduate students.

Over a decade ago, Australia developed a national strategy to recruit the very best graduate students from around the world by offering them substantial financial assistance. How is Australia paying for this? Well, Australia is aggressively recruiting international undergraduate students and charging them market-based tuition fees to help finance its graduate student programs. Sounds like a good idea, doesn’t it? This is a model Quebec would do well to consider.

The quality of our programs is world-class. Yet our international tuition fees, like our domestic tuition fees, are the lowest of any jurisdiction in Canada or the United States. We are selling ourselves short and this hurts our reputation as well as our finances.

Look at our great state enterprises, such as Hydro-Québec, or the Caisse de dépôt et placement. The government of Quebec has lifted restrictions on these enterprises so they can compete freely and bring as much money as possible into Quebec. Hydro-Québec charges below-market electricity rates to Quebecers. But once Quebecers’ needs are met, it is free to sell power to export customers at market rates.

Like Hydro-Québec, our universities offer services to Quebecers at below-market rates. Eighteen hundred dollars per year, compared to eighteen thousand dollars per year at a low-priced American university. Fine. Let’s give Quebec’s students, and those who cannot afford to pay, a good deal. But, in the case of foreign undergraduate students who can afford to pay a full fee, it is hard to comprehend why Quebec’s universities are prevented from charging the going international rates. How can this be good for Quebec?

Because recruiting more international graduate students is vital for our future, we must provide incentives – not disincentives – for our universities to attract as many of the world’s best minds as we can.

Creating a game plan

Consciously and strategically, our universities are focusing on their strengths. For example, the Université du Québec à Chicoutimi has chosen five research priorities of particular importance to the Saguenay-Lac-Saint Jean region, including research in aluminum, in renewable forestry and in the relationship between atmospheric ice and electricity. McGill has focused on eight areas, including, among others, genetics, neurosciences, nano systems and materials, environmental sciences and health and social policy.

With great foresight, Quebec has identified its clusters of industrial excellence – including aerospace, pharmaceuticals, biotechnology and computer graphics. And each of Montreal’s universities is contributing to the growth of one or more of these sectors – most, to all four. But we are under-leveraging these sectors and others of distinctive advantage because we do not have a Montreal or Quebec strategy that brings our university, government and private sector assets together in a strategic and co-ordinated plan to advance our excellence in these key areas on the world stage. We can do this, and we will.

For example: in legal studies and research, our Quebec tradition of teaching both civil and common law uniquely equip our scholars to tackle the complexity of creating international legislation and policy that will work across borders and across legal systems. We must seize the opportunities stemming from this unique environment to make Montreal and Quebec a world centre of excellence in international commercial law and promote it as such.

Quebec also has pockets of tremendous competitive potential in genomics, nanoscience and advanced materials, and environmental sciences that are the foundation for value-added products and services essential to Quebec’s success – but once again the links between universities and industry must be consolidated and leveraged strategically with excellence and global impact as the goal. And we must measure our progress against the best in these fields, year by year.

Together, we must:

  • identify the niches where we can excel on the international stage;
  • leverage the talent, actions and investment to grow necessary critical mass and quality in these areas of strength; and
  • define a means to reach out to key regions of the world that have a particular resonance with our strengths.

For example, Premier Charest’s recent trade missions to China and to India, included both industry and universities, and have advanced 14 emerging partnerships between McGill and India among others.

We know talk is cheap. It is not enough to have a plan – we have to implement it. For that, we require a shared vision and, above all, we need leadership and passionate engagement that straddles all sectors involved in innovation. We must avoid petty politics and local turf-wars. We must focus on the reputation, impact and success for Quebec and Canada, and for our international partners.

Quebec has certain elements of the foundation in place on which we can build. So I will pose my last, and most important question: How can we best position our universities to ensure that Quebec succeeds? My answer - my “Top Ten” list – is as follows:

Number 10:

We must work with families and communities to improve high school completion rates among young Quebecers and to foster an expectation that their children can, and will, complete a university education – especially if they are the first in their family to do so. This must be part of a new concerted Quebec strategy to raise our degree completion rates dramatically over the next decade – a strategy that will increase the number of undergraduate degrees awarded by over 50 percent and triple the number of Master’s and doctoral degrees. Nothing else will better position us for global rewards.

Number 9:

We must lift the cap on international undergraduate tuition fees and thereby provide Quebec’s universities with financial incentives to recruit full-time international students. To succeed at this, we must develop an effective, co-ordinated international marketing campaign to make Quebec a preferred global destination for higher education.

Number 8:

Quebec must increase funding for international graduate students to compete for the best young talent from across the world. This will provide new sources of talent and income. They will have an impact on the health and prosperity of all. They will create strong international ties.

Number 7:

The Quebec government must quickly advance the money it has committed to address the deferred maintenance in our universities. We must equip them with the modern facilities necessary to attract and retain world-class talent.

Number 6:

Consistent with its mission, each of our universities must advance its own strategy to maintain and grow teaching and research excellence, in distinctive areas of strategic importance and strength. We must also benchmark the impact of our programs against top relevant peers in Canada and around the world.

Number 5:

Universities, businesses, industry and government must target their core distinctive strengths in key areas of advantage for Quebec and Canada. They must also create the partnerships to achieve critical mass and excellence in North America and on the international stage.

Number 4:

Our universities must continue to improve the effectiveness and transparency of their governance and administration and communicate this to the public.

Number 3:

We must recognize that we pay a heavy price for over-regulation. It can stifle innovation and diminish our ability to attract and retain top talent in universities, just as it does in other sectors of the economy. The Quebec government must diminish – not increase – its bureaucratic control of our universities, while creating incentives for them to respond quickly and effectively to emerging challenges and opportunities.

Number 2:

We must suppress our tendency to turn every government program into an equalization effort. We must invest in our most promising areas. Doing so will allow us to develop a critical mass of expertise and research that will stand up to international competition. Funding that is spread thinly can only lead to mediocre results.

Finally, I turn to the Number 1 thing that must be done to position our universities to ensure that Quebec thrives.

At a time when other countries are increasing their investments in higher education, we need a competitive university funding base from government. We must also call upon students, families, industry and philanthropy to play their parts. Our universities have a deep public purpose, and so belong to our society as a whole. And we must all contribute to achieve the maximum benefit across sectors. We must find the courage, and political will, to re-think our “Dollar Store” tuition policy – a policy that fosters neither accessibility nor quality and that straightjackets our universities financially.

If we are complacent, the world will pass us by. We have the talent and resources to succeed. I know we can succeed. And I know if we act with urgency and determination, we will prevail.

Thank you.