Balancing Diversification and Stability in Australia's International Education
By Luke Sheehan, CEO, Universities Australia
The Australian international education sector is undergoing a significant reset, driven partly by the Albanese government's renewed focus on Southeast Asia. The Prime Minister's recent visit to the region underscored this push to deepen ties with neighbouring nations in diplomacy, trade, education, and research.
This strategic pivot toward ASEAN nations offers enormous opportunities and demonstrates that education remains a priority in building regional partnerships and securing Australia's place in the Indo-Pacific.
Maintaining Strong Foundations
However, as we expand into new markets, we must not undervalue or abandon those that have defined our success as a university sector and as a nation. This challenge was front of mind for a delegation of senior university leaders who visited China last week, led by Universities Australia, to deepen ties and broaden engagement with one of our oldest partners.
Australia and China have long understood the importance of education, which has helped bring our countries closer together for over a century. Today, more than 170,000 Chinese students study in Australia—the largest cohort of international students on our shores. Their presence underpins thousands of jobs, drives economies across the country, and sustains Australia's reputation for world-class education.
Beyond the economic dividend lies something even more valuable: a reservoir of trust and familiarity that strengthens our broader national interests. Our education relationship with China has been, is, and likely always will be among Australia's most effective tools of soft power.
A Stabilising Force
Universities have maintained consistent relationships with China over many decades, always conscious of Australia's interests while finding fruitful paths to collaborate that benefit both nations. Our researchers partner on shared challenges—from the energy transition to combating global diseases—and graduates from both countries take on leadership roles in their respective nations.
Education has proven to be a stabilising channel even when diplomatic relations have been strained. Maintaining those connections is crucial in an increasingly fragmented world.
Our visit to China last week recognised this, signalling the start of an exciting new education chapter as we build on our century-old relationship through education and research.
Complementary, Not Contradictory
This approach is not about fighting the government's diversification efforts—it's about complementing them.
The push into Southeast Asia is strategically sound. Countries such as Indonesia, Malaysia, Vietnam, and the Philippines are growing rapidly, with expanding middle classes and strong demand for quality education.
Australia's universities are already responding through transnational partnerships, dual-degree programs, and offshore campuses. Last week, Monash University announced a one-billion-dollar new campus in Kuala Lumpur—excellent news that strengthens regional ties, opens new student pathways, and contributes to Australia's economic and diplomatic footprint in our region.
An Additive Strategy
But any effort to diversify should be additive, not subtractive. Reducing our exposure to key markets without equivalent growth elsewhere would hurt our sector financially and weaken Australia economically and diplomatically.
The Chinese education market remains one of the world's largest and most sophisticated. A stable, mature relationship there can coexist with new partnerships elsewhere.
Looking Forward
As we reset Australia's international education sector, we need to maintain our established strengths while cultivating new ones. By deepening ties across ASEAN and sustaining our engagement with China, Australia can position itself as an education and innovation hub at the centre of the Indo-Pacific.
Education has long been Australia's quiet superpower—a means of influence, prosperity, and regional stability. As global competition intensifies, it remains one of the smartest investments we can make in our future. That's why we should approach it with a broad lens, not a narrow one.