Users of China’s largest ride-hailing service visiting the U.S. can now call up cars courtesy of Lyft Inc., as the two startups strengthen an alliance intended to curtail Uber Technologies Inc.’s rapid global expansion.
Starting this week, any of Didi Kuaidi’s almost 300 million customers will be able to use the Chinese company’s app in the U.S. to access Lyft’s pool of private cars, they said in an e-mailed statement. In-app translation will help smooth language wrinkles, and they can pay via Chinese services Alipay and WeChat.
The reverse may soon become a reality. As early as this quarter, Lyft users may be able to use their apps to hail a taxi when in China, according to the statement. Didi and its San Francisco-based partner have been integrating services which span hundreds of cities across both countries and have now rolled out a trial version for the U.S.
“Just like any Internet product, the launch is on a phased schedule. Going forward, the opportunities are wide open,” Li Zijian, Didi’s senior director of international strategy, said by phone. “Didi will be offering its private cars and Lyft will be offering its equivalent to private cars.”
America is a popular destination for Chinese tourists, the most numerous on the planet. About 5 million people travel between the two countries every year, according to tourism bureau data that Didi cited.
First Fruit of Alliance
Lyft and Didi are testing what amounts to the first major initiative from a global push to fight Uber. The two have teamed with Southeast Asia’s Grab and India’s Ola. Didi itself is stockpiling cash for the battle ahead. China’s largest ride-hailing service raised the target on its latest round of funding to more than $1.5 billion, which could value the company at more than $20 billion, a person familiar with the matter has said.
Both Didi and Lyft will review their partnership on a regular basis to work out financial sharing arrangements and gauge its success.
“We’ve agreed to review it every few months and it’d be fair to say that by year’s end, we’ll have a review of the product, of the experience and of the business,” Li said.
Didi expects to be able to serve about 30 million riders daily by the year’s end. It has a wider range of services than its partners – customers can hail taxis, car-pool with drivers and even hop on buses. Its partner, Lyft, debuted car-pooling for the Bay Area in March.
“Going forward we have the Lyft Line and the Didi Hitch and other types like taxis” to offer, Li said.
LAST year was a watershed year in the higher education sector, as students at most South African universities protested under the #FeesMustFall banner. Some were calling for free tertiary education.
Chapter 2 sub-section 29 (1) (b) of the Constitution states, “Everyone has a right to higher education which the state, through reasonable measures, must make progressively available and accessible.” It is quite clear that this does not create an obligation on the state to provide free higher education.
The question that must be asked is whether the state has made advances since 1994 in making higher education available and accessible. The answer is a resounding yes when considering the growth in the number of students enrolled in South African higher education institutions including technical and vocational education and training (TVET) colleges, community colleges and universities.
The participation rate in higher education for youth in the 20-24 age group increased from 15.4% in 2003 to 19.5% in 2013.
The state has also made TVET colleges and universities accessible to thousands of poor students through the National Student Financial Aid Scheme (NSFAS). The NSFAS Act was promulgated in December 1999 to give real effect to the government’s commitment to redress the inequities of the past and tackle the growing student debt problem in higher education institutions.
NSFAS and its predecessors awarded R50.5bn to about 1.5-million students in the form of loans and bursaries between 1991 and 2014 at 25 public higher education institutions and 50 TVET colleges.
Despite the increase in the number of students who now have access to higher education, when we consider the state budget allocated to universities from 2000 to 2014, it is clear that universities have become less affordable to students coming from poor and middle-income families.
The proportion of university income coming from the Department of Higher Education and Training’s budget vote declined in real terms from R15.93bn (which constituted 49% of total university income) in 2000 to R22.9bn (40.9%) in 2014. Universities raised student fees to offset the decline in state funding. The contribution of student fees to university income rose from R7.8bn (24%) in 2000 to R19.6bn (35%) in 2014.
SA’s spending on universities is comparatively low by world standards. In 2011, the state budget for universities including funding for the NSFAS, as a percentage of gross domestic product (GDP) was 0.75%, just less than Africa as a whole (0.78%).
The budget for the 2015-16 fiscal year is 0.72% of GDP, lower than it was in 2011. This is also significantly lower when compared with the 2011 figures of African countries (0.78%), Organisation for Economic Co-operation and Development countries (1.21%) and the rest of the world (0.84%).
The National Development Plan’s vision for 2030 is a post-school system that produces graduates who have skills to meet the current and future needs of the economy and society. The different parts of the education system should work together to allow students to take different pathways that offer high-quality learning opportunities.
There should be clear linkages between schools, further education and training colleges, universities of technology, universities and other providers of education and training. There should also be clear linkages between education and training and the world of work.
In spite of the progress SA has made to improve access to higher education, many challenges remain. Some of these are:
• The funding challenges and deteriorating affordability of higher education to students from poor and middle-income households;
• Students who do not qualify for NSFAS funding but are also financially constrained — the so-called “missing middle”;
• The high drop-out rate from higher education that particularly affects students from poor households;
• High youth unemployment. This particularly affects young people from poor families and graduates from historically disadvantaged universities; and
• NSFAS challenges, including ineffective administration and poor loan recovery.
SA has adequate resources and capacity to solve the challenges we face. The solutions lie in driving better co-ordination of government programmes in education generally, as well as driving better co-ordination and collaboration between the government on the one hand and the private sector and institutions of higher learning on the other.
A process has been started to accelerate the building of a sustainable public-private partnership model. This model plans to raise enough funding to offer comprehensive financial support to students from poor and middle-income households, as well as academic, psychosocial and life-skills support.
The key objective is to improve access, success and employment of poor and “missing middle” students as they enter, progress through and exit higher education institutions. Through this model, I believe it is possible to offer fully subsidised university education to the poorest students in exchange for some community service after graduation.
The model seeks to give effect to the constitutional requirement to improve access and success of students. Financial support would include a combination of grants, bursaries and loans regulated by various criteria, but with the guiding principles of reducing the financial burden on poor, means-tested households and the promotion of skills production of occupations in high demand. The loans-grants ratio will increase as the household income increases up to a determined middle-income threshold.
The key success conditions for the model to be sustainable include:
• The creation of a robust public-private partnership based on a shared vision encapsulated in the National Development Plan that requires a post-school system that produces skills to meet the current and future needs of the economy and society;
• The development of innovative funding mechanisms to increase available funds substantially;
• Centralised objective control of all granting and disbursement decisions to optimise the production of graduates in occupations in high demand;
• Implementation of best of breed and “fit-for-purpose” student identification, household means-testing, grants and loans approval, loans collection and graduate employment placement. Social contracts with students together with comprehensive psychosocial and life skills support structures are also a priority; and
• Comprehensive data structures as well as auditing and monitoring systems in line with key goals.
SA has shown its resilience and ability to solve its challenges, and the challenges in higher education will be attended to if all stakeholders work together driven by a common vision.
The Human Resource Development Council (HRDC) — a multistakeholder forum made up of social partners including organised labour, private sector and higher education institutions, among others — has taken up the issue of the funding of post-schooling education and will be hosting a summit at the Gallagher Estate convention centre in Gauteng with the theme: Partnerships for Skills — A Call to Action.
• Nxasana is a council member of the HRDC and chairman of NSFAS