$300 Million Scholarship for Study in China Signals a New Focus
View(s):HONG KONG — The private-equity tycoon Stephen A. Schwarzman, backed by an array of mostly Western blue-chip companies with interests in China, is creating a $300 million scholarship for study in China that he hopes will rival the Rhodes scholarship in prestige and influence.
The financier Stephen A. Schwarzman is creating a scholarship program at Tsinghua University in Beijing. .
A rendering of the new college at Tsinghua University that will be named after Mr. Schwarzman.
The financier Stephen A. Schwarzman is creating a scholarship programme at Tsinghua University in Beijing- Todd Heisler/The New York Times
The program, whose endowment represents one of the largest single gifts to education in the world and one of the largest philanthropic gifts ever in China, was announced by Mr. Schwarzman in Beijing on Sunday.
The Schwarzman Scholars program will pay all expenses for 200 students each year from around the world for a one-year master’s program at Tsinghua University in Beijing.
The program’s creation underlines the tremendous importance of China and its market to Wall Street financiers and corporate leaders, who have become increasingly anxious as security and economic frictions grow between China and the West.
Mr. Schwarzman said his goal was to reduce such tensions by educating the world’s future leaders, but his role in the project will also raise his political profile in China, potentially giving him and his private equity firm, the Blackstone Group, increased access to Chinese leaders. Many of them, including Xi Jinping, who became president of China last month, attended Tsinghua, one of the country’s top universities.
Mr. Schwarzman said he was donating $100 million from his personal fortune, which Forbes estimated last month at $6.5 billion. He said he had raised $100 million from donors, and expected to raise the remaining $100 million by the end of this year.
Many of the donors have sprawling business interests in China and frequently deal with government regulators and state-owned enterprises that have wide discretion over the activities of foreign companies.
The donors include Boeing, which is aggressively marketing jets in China, the world’s second-largest aircraft market, and Caterpillar, which sells earth-moving equipment in what has become the world’s largest construction market. They also include JPMorgan Chase, Bank of America and Credit Suisse, which provide financial services to the Chinese government and state-owned banks.
The biggest donor after Mr. Schwarzman is BP, which produces and imports natural gas in China and also has joint venture chemical plants and other operations in the country.
The personal foundation of MayorMichael R. Bloombergof New York is also a donor. Mr. Bloomberg’s media company is trying to lease more news and data terminals to state-owned banks, but it has been stymied by the government since the company’s publication last year of an investigation into the financial dealings of Mr. Xi’s family.
The scholarship’s advisory board is a who’s who of investors, diplomats and other influential figures, some of whom also have political or financial ties to China. It includes three former secretaries of state, Condoleezza Rice, Colin L. Powelland Henry A. Kissinger; two former treasury secretaries, Robert E. Rubinand Henry M. Paulson Jr.; a number of university presidents and cultural figures, including the cellist Yo-Yo Ma; former President Nicolas Sarkozyof France; and the former prime ministers of three countries, Tony Blair of Britain, Kevin Rudd of Australia and Brian Mulroney of Canada.
Many large Western companies have been pressing for closer ties with China even as security experts warn about China’s military expansion and territorial claims, and many smaller businesses and labor groups warn that China seeks to dominate a wide range of industries.
Mr. Schwarzman said his concern was that as long as the Chinese economy grows two to three times as quickly as the American economy, and with European economies barely growing at all, tensions are likely only to rise.
“The idea was to deal with this problem in a generational manner,” he said in a video interview from New York, adding later in an e-mail, “I feel grateful to be able to have the resources to help change future leaders to impact their countries’ and China’s destinies.”
The program plans to take in 10,000 students over the next 50 years, forming an international network that can bridge differences between China and the West, he said. Forty-five percent will come from the United States, 20 percent from China, and 35 percent from Australia, Canada, Europe, Latin America and the rest of Asia. Africa may be added later.
The scholarship program will not be Mr. Schwarzman’s first major foray into China, where private equity firms like his have been trying to gain entry. In 2007, as he was preparing to take Blackstone public, he sold a $3 billion stake in the company to the China Investment Corporation, the country’s giant sovereign wealth fund. The deal stirred controversy in China when the value of the stake plunged, along with most stocks, during the global financial crisis, drawing vehement criticism among some Chinese. Chinese leaders brushed off the concerns, and the stock has since nearly recovered when dividends are included
Mr. Schwarzman, 66, got his start at Donaldson, Lufkin & Jenrette, an investment bank later purchased by Credit Suisse. Except for a brief stint in the Army Reserve, he has spent most of his career at two Wall Street giants: Lehman Brothers, whose sale he led in 1984, and then Blackstone, where he is chairman and chief executive.
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