By Vivian Salama
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Sept. 15 (Bloomberg) — When U.S. teenager Anthony Spalvieri-Kruse was considering which college to attend, he got an offer he couldn’t refuse from 7,200 miles away in Abu Dhabi.
“I’m receiving a full ride to attend, including flights and an allowance of $2,000 a year,” said Spalvieri-Kruse, now ensconced in what he calls “uber-swanky” accommodation in the United Arab Emirates. “It was pretty incredible considering that I was looking at $30,000 a year from other places.”
The 18-year-old from Kalamazoo, Michigan, is among the first students at New York University’s Abu Dhabi campus, which began classes this week. The college is being bankrolled by the emirate as it tries to underpin a $500 billion development plan by more than doubling investment in education this year.
NYU follows Paris’s Sorbonne University, which started offering courses in Abu Dhabi in 2006. Mubadala Development Co., an investment arm of the emirate, agreed last year to build a 93,000 square-meter campus for the French institution.
Of the 162 branch campuses in the world today, half are located in the Persian Gulf, with 25 percent in the U.A.E. alone, according to the Observatory on Borderless Higher Education, a London-based information service. Branch campuses differ from overseas programs offered by U.S. universities in that they usually function independently from the main school and have academic and administrative support on site.
The need for investment in higher education “is absolutely urgent,” said Rafic Makki, executive director at the Office of Planning and Strategic Affairs and Higher Education at the Abu Dhabi Education Council. “We are definitely on the right track, but we are nowhere near where we need to be.”
While Dubai, located an hour and a half across the desert, built skyscrapers and glitzy malls to turn itself into a hub for tourism and finance, Abu Dhabi is trying to become a cultural center with branches of the Guggenheim and Louvre museums and visits from the New York Philharmonic.
Abu Dhabi has the means to do it. The emirate, which spent $20 billion bailing out Dubai’s excesses, holds about 7 percent of the world’s oil supply. Under its 22-year economic development plan, the Abu Dhabi government estimates that non- oil industries will contribute half of total gross domestic product by 2015 versus about 40 percent today.
“From a fundamental development point of view the first and most important goal should be human capital development,” said Giyas Gokkent, chief economist at the National Bank of Abu Dhabi. “It takes a long time to establish a good university. You need experienced professors, libraries, campuses.”
Some U.S. universities have been and gone in the U.A.E. Washington-based George Mason University shut its doors last year in Ras al Khaimah, one of the northern emirates, citing the global economic crisis. Michigan State University closed its Dubai campus in July, six months after the bailout by Abu Dhabi.
One of the challenges is convincing students to make Abu Dhabi or Dubai their college town instead of Boston, New York or Chicago. In the 2008-2009 academic year, U.A.E. enrolment in U.S. universities jumped 24 percent from the previous year as student visas increased to pre-September 2001 levels, according the New York-based Institute of International Education.
The Abu Dhabi government plans to spend more than 1.3 billion dirhams ($350 million) on education this year, compared with 655 million dirhams in 2009 and more than six times the expenditure in 2008, according to statistics included in a preliminary government-guaranteed bond prospectus in July.
As much as $1 billion in academic research investments is needed per year through 2018 for Abu Dhabi to compete globally with some of the top universities in the world, Makki said.
Other colleges represented in Abu Dhabi include New York Institute of Technology, which offers a degree program, and U.A.E. University. Australia’s University of Wollongong and Canada’s University of Waterloo offer programs in Dubai.
Similar efforts have been made in Qatar, where Georgetown University and Texas A&M are among a half dozen American schools now operating in Doha’s academic hub, a 2,500-acre campus known as Education City. Like NYU, these campuses receive their funding from a government-run foundation. (Click here to read my story on Qatar’s Education City)
The NYU campus, situated in a temporary facility near Abu Dhabi’s waterfront, will relocate to Saadiyat Island, a manmade plot by the emirate’s Tourism Development & Investment Co., known as TDIC. It’s scheduled for completion in 2013.
Along with paying all costs associated with the university, Abu Dhabi will reimburse NYU for the expense of replacing the faculty staff relocating to the Middle East. Abu Dhabi has also made a $50 million gift to NYU, John Sexton, the university’s president, said in an interview earlier this year.
Of the 150 students in the first intake, about a third are American citizens and about 8 percent from the U.A.E. The rest hail from countries including China, Hungary and Russia.
Bringing NYU to Abu Dhabi “is a strategic investment just like everything else we are doing here,” Mubarak Hamad Al Muhairi, managing director of TDIC, said in an interview.
Hasnain Zaidi, 23, an Abu Dhabi native who graduated from Duke University in 2008 and now works as a consultant in the U.S., said partnerships with more universities may also convince many of the Gulf’s foreign college-bound students to stay.
“Public service, athletics, social life, personal development — none of those things was readily available at any of the options in the U.A.E.,” he said. “That’s slowly getting better, but still not completely fixed.”
Spalvieri-Kruse plans to major in mathematics and relishes the idea of classes with no more than 20 students, he said.
“Abu Dhabi doesn’t even fall in the realm of college environments most American kids consider,” he said by e-mail. “Actually seeing the town for myself totally changed things. My visit gave me the impression that everyone involved was highly invested in the success of the incoming class.”
To contact the reporter on this story: Vivian Salama in Abu Dhabi at email@example.com