Worlds of Education

Privatisation and commercialisation of universities in Latin America

published 5 November 2019 updated 5 November 2019

By Fernanda Saforcada and Yamile Socolovsky

Today we are releasing the results of the first stage of an ongoing research project, which aims to explain clearly the main characteristics and patterns of the phenomenon of university privatisation and commercialisation in Latin America. This study is not intended to be neutral; it is designed to aid in the development of strategies. Its conclusions will be reflected in the political action proposed to combat this process, in order to ensure the right to education and promote the democratisation of knowledge.

First and foremost, it is imperative to understand that capitalism, which turns everything it touches into a commodity, is rapidly advancing at this stage, especially in the field of education and knowledge. This is a decisive factor in ensuring private appropriation of wealth through the control of technological development; this dynamic has always been present throughout history, but is now strengthened by the dizzying acceleration of competition for the global market. Furthermore, education and knowledge itself have begun to be conceived, produced and distributed as tradable goods, the trade of which results in exorbitant profits for an increasingly concentrated group of corporate enterprises, even providing lucrative opportunities in financial speculation.

At the university level, the elements that make up this process of privatisation/commercialisation are complex in their own right, and tackling them requires a process of systematisation and conceptualisation. To be able to act, it is essential to be able to understand how this process develops concretely, to identify the characteristics of the privatisation and commercialisation of education and knowledge specifically within the university sector, and to recognise the ways in which this global trend is embedded in our particular Latin American context. Within this framework, it is of the utmost importance to consider not only the dynamics of the expansion of the private sector, but also the gradual incorporation of mercantile logic into public systems increasingly colonised by particular interests, as well as the subtle search for the lack of distinction between the public and private sectors that threatens to erode any possibility of safeguarding common interests, rights and equality.

At present, Latin America is one of two regions in the world with the most privatised universities, along with South Asia. Some 55% of enrolment is in the private sector, compared to 13% in Europe, 36% in Asia-Pacific and 28% in North America (data from UIS-UNESCO and Red ÍndicES for 2015–2016). This implies hyper-privatisation not only in overall comparison, but also in the extent to which the private sector encompasses a larger number of students than the public sector (in some countries, much larger). In the future, this means that an increasing percentage of the better educated sector of the population will have received their higher education in institutions that conduct their activities as a function of private interests. Today, the vast majority of countries in the region have over 30% of student enrolment in the private sector, reaching over 70% in some countries such as Peru, Puerto Rico and El Salvador, and over 85% in Chile.

Behind the expansion of the private sector lie two different issues. On one hand, there are the processes of social distinction and, with them, the search for elite circles within a context of growing ideological privatisation. This is not a massive phenomenon, but a trend that has been appearing for several decades and has intensified in recent years.

However, the main factor in the expansion of privatisation stems from the combination of increased demand and reduced public resources for higher education. Indeed, there has been a substantial increase in demand, caused both by the growth in expectations of enrolment in university and by the increase in enrolment and graduation rates at the secondary level (linked to the expansion of compulsory secondary education in all countries throughout the region during the first decade of the century). This can be observed in the expansion of enrolment in higher education, which has been very significant: between 1990 and 2005, i.e. in 15 years, the gross rate doubled, and between 1990 and today, it tripled.

However, resources for the university public sector have remained the same or have not grown in proportion to this increased demand. The solution to this tension between greater demand and less public resources has been to strengthen the selectivity of public universities, which means that a substantial part of this demand is diverted to the private sector, as is the case in many countries in the region such as Peru, the Dominican Republic, Chile, Costa Rica, Brazil and Paraguay, among others. The often explosive rise of low-cost universities is largely explained by this situation, as they have become the means of escape from this tension and, at the same time, a formidable business due to high demand.

A second aspect, related to commercialisation, is that when faced with shortages of resources, public universities are faced with the situation of having to partially or completely self-finance, either through fees charged to undergraduate and/or postgraduate students, or by seeking other sources of financing such as the sale of services. In some cases, these resources that are obtained through tariffs and the sale of services are not supplementary but instead become essential for the maintenance of the institutions themselves in their most basic aspects, as is the case in Chile and Peru.

A third issue that we have observed as a privatisation trend is the equalisation of the public and the private sectors. This is true of various regulatory bodies and mechanisms. The information gathered for these case studies enabled us to identify how this public–private boundary in the flow of public funds began to become increasingly porous until it was blurred in relation to some issues. The most significant are funds associated with research tracks, research funds, postgraduate or research scholarships and, last but not least, study scholarships or state-guaranteed credits. With apparent neutrality, common systems or bids are established for both sectors, which are presented as egalitarian and therefore fair, but which in practice have provided the means for a significant and growing portion of public resources to be diverted to the private sector without political cost or discomfort in the sector.

On the other hand, private universities have indirectly benefited from public resources by being exempt from paying taxes. This tax exemption implies a substantial, albeit overlapping, transfer of resources that is observed in the cases studied.

Latin America and its university systems are the territory in which a substantive dispute is currently unfolding over the meaning of education and knowledge, and, in short, what kind of societies we want. The processes, actions and actors are heterogeneous, but there are common elements and strategies. This shows that it is necessary to study the issue with this two-fold perspective of the common and the diverse, as trends are regional but the forms they take are local.

The intersection of privatisation and commercialisation, expansion of the private sector and market orientation of the public sector has significant ramifications and requires urgent action. The ways in which these processes are being promoted have become less evident, as the differences between the public and the private sector tend to become diluted and, at the same time, the private sector appropriates and redefines traditional values of public universities such as autonomy and their role in democratising access to higher education.

This poses enormous challenges for university collectives, teacher unions and all organisations committed to equality, justice and social rights. At stake is not only the university system itself, but also its role in the construction of hegemony and its enormous capacity to influence public policy.

The growth in the number of private institutions with explicit or hidden profit-making purposes, the increase in student enrolment in such institutions, the payment of fees for undergraduate studies, the explosive expansion of the "supply" of postgraduate studies, the deregulated growth of virtual modalities in higher education, the development of a cross-border academic market. But also, the implementation of mechanisms for academic evaluation that push institutions and staff into unbridled competition for accreditation of quantifiable results under the bibliometrics empire, and that ultimately feed the profits of a few publishing companies that diversify their businesses at different educational levels and offer institutions training, assistance, management or administrative services. Private funding, which influences research in public institutions, and the transfer of public resources to finance the activities of private institutions. The substitution of co-government for managerial forms of institutional leadership and organisation. The growing presence of corporate representatives within the sector's public policy-making spheres. The influence of international organisations in the formulation of these guidelines and in the construction of assessments and concepts that legitimise the reforms required to facilitate this business, which is at the same time a device of discipline and ideological domination that seeks to break any possibility of developing a counter-hegemonic culture.

Forms, aspects, dimensions of a process that, while denying the right to education and participation in the collective production of knowledge, threatens to liquidate the democratic dimension of the Latin American public university, depriving us of the possibility of finding in it an environment that enables the development of critical thinking and the training of professionals committed to popular struggles.

Faced with this situation, unions in the university sector have a daunting task ahead of them. First, they must produce knowledge about this process in order to understand it, explain it and denounce it. It is essential to break the hegemony of an academic culture that accepts, reproduces and reinforces mechanisms of privatisation/commercialisation, and there is no other way to do this but through critically assessing the conditions of development of the activity itself. It is also necessary to highlight how this trend is linked to the current proliferation of forms of precarisation of academic work, and to link union demands for adequate working conditions with the political questioning of factors of commercialisation.

However, criticism, rejection and the construction of alternatives cannot be achieved through individual action, but rather through collective mobilisation. It is therefore also up to the unions to find the means to summon workers in higher education and research to take an active part in these debates and this struggle, and, moreover, to join all the organisations in a cause that, like the defence of public education in general, calls into question the democratic sovereignty of our peoples. If every struggle is rooted in the strength of its organisation within a territory, it is also essential to lend this endeavour the strategic perspective of international action, the first step of which is undoubtedly regional: to confront commercial transnationalisation, academic colonisation and technological dependence from the strength of the Latin American context of a university project that, driven by workers, places at the centre of the policy of governments and institutions the principle of the right to attend university and the reclamation of knowledge as a common good.

Download the summary in English here.

Download the full report in Spanish here.

The opinions expressed in this blog are those of the author and do not necessarily reflect any official policies or positions of Education International.