(SBU) SHANGHAI MBA SCHOOL FEELING IMPACT OF FINANCIAL

UNCLAS SECTION 01 OF 02 SHANGHAI 000040 SENSITIVE SIPDIS TREASURY FOR AMB HOLMER/WRIGHT/TSMITH TREASURY FOR OASIA/INA -- DOHNER/HAARSAGER/WINSHIP/CUSHMAN TREASURY FOR IMFP -- SOBEL/MOGHTADER USDOC FOR ITA DAS KASOFF, MELCHER, MAC/OCEA NSC FOR WILDER/LOI STATE PASS CEA FOR BLOCK STATE PASS USTR FOR STRATFORD/WINTER/MCCARTIN/KATZ/MAIN STATE PASS CFTC FOR OIA/GORLICK E.O. 12958: N/A TAGS: CH ECON EFIN ELAB SUBJECT: (SBU) SHANGHAI MBA SCHOOL FEELING IMPACT OF FINANCIAL CRISIS ¶1. (SBU) Summary. A prominent Shanghai-based international business school is seeing demand for its Executive MBA (EMBA) program dropping in recent months as the financial crisis hits the bottom line of foreign and domestic corporations in China, according to two new Consulate contacts speaking with Congenoffs on January 20, 2008. The contacts also said that MBA students close to graduation are having trouble finding employment. End summary. ¶2. (U) According to the school's website (www.ceibs.edu),the China Europe International Business School (CEIBS) was established on November 8, 1994, in Shanghai. Based on its own campus in Pudong, Shanghai, the school is a not-for-profit joint venture established under an agreement between MOFTEC (now the Ministry of Commerce, or MOFCOM) and the European Commission. CEIBS also has offices in Beijing and Shenzhen. CEIBS receives financial support from the Municipal Government of Shanghai and the European Union. The school has a faculty of 50, most of whom are U.S. citizens. The 18-month MBA program enrolls around 180 students, while the two-year Executive MBA (EMBA) program enrolls around 600-650 students. ============================ Corporations Trimming Back Executive Training ============================ ¶3. (SBU) CEIBS is seeing demand for its EMBA program dropping in recent months as the financial crisis hits the bottom line of foreign and domestic corporations in China. CEIBS Dean Rolf Cremer said that the decline is not yet significant, but he anticipates that applications could fall by 10%-20% should the crisis last one to two years. The declines in applications for CEIBS's Beijing and Shenzhen satellite campuses is more noticeable than at the main Shanghai campus, said Cremer. ¶4. (SBU) Cremer said that one of the drivers of lower EMBA applications is reductions in nonessential expenditure by enterprises. He is hearing from foreign corporations in Shanghai that "cash is king," leading to cuts in executive training. Nonetheless, this will not affect CEIBS's operating revenues, since the school currently only accepts one-quarter to one-third of qualified EMBA applicants. ¶5. (SBU) Changes in student demand for the MBA program do not track with those of the EMBA program, because MBA students generally are not relying on a sponsor, said Cremer. Therefore, as in other fields, business school applications are up, said Cremer, implying that applicants are finding the job market less than favorable and look to school as a place to ride out the economic hard times. MBA Academic Director Lydia Price said that the current class of MBA students is CEIBS's strongest yet. ¶6. (SBU) However, students close to graduation are having trouble finding employment, said Price. Cremer and Price agreed that foreign students in China have particular difficulties, as they generally attend CEIBS as an entry point to a career in China, but they are facing a time limit on their job searches because of time limits on student visas. Price encouraged Congenoffs to help bring CEIBS graduates, one-third of whom are from the United States and Canada, to the attention of U.S. corporations and business forums. ============================ CEIBS Welcomes Greater Cooperation with the Consulate ============================ ¶7. (SBU) Cremer emphasized that CEIBS is looking to increase exchange with the Consulate. CEIBS sponsors high-level industry forums--including ones on the automotive industry, banking, heath care, luxury goods, and media--which Congenoffs are welcome to attend, said Cremer. CEIBS has close connections with the Lujiazui financial district, thanks in part to SHANGHAI 00000040 002 OF 002 co-President Zhu Xiaoming, who is also a vice chairman of the Shanghai Committee of the Chinese People's Political Consultative Conference, Cremer explained. Zhu was instrumental in establishing the CEIBS Lujiazui International Finance Research Centre, which holds periodic finance salons and an annual financial forum. (Note: Treasury U/S David McCormick was a keynote speaker at the forum on October 21, 2008. End note.) CAMP