Is there a Paris match for UK's overseas appeal?

Sarkozy's reforms may drive French universities to compete for our lucrative foreign student market, warns Peter Brady

Whether it's igniting Joan of Arc's passions and eventually her toes, waging war for a hundred years or struggling for supremacy on rugby and football fields, England's relationship with France has always been competitive. But when it comes to recruiting foreign students, the UK has long had the upper hand.

While French universities are forbidden from charging overseas students fees, British institutions have turned their studies into one of the country's largest export earners. With the election of Nicolas Sarkozy, however, this could be about to change. The policies of the new French President could transform France into a major player in this important market, capable of attracting substantial numbers of overseas students. French gain could well be at Britain's expense.

Mr Sarkozy has pledged to increase higher education funding by €15 billion (£10 billion). According to Jean-Robert Pitte, vice-chancellor of the Sorbonne, this money could come from the introduction of tuition fees. This is a radical suggestion for a country whose students have fought, and won, the right to a free education.

Such talk by the likes of Professor Pitte must worry Mr Sarkozy. Since the revolt of 1968, French governments have been wary of the power of the student body. Only last year, campuses were occupied, and 3 million students and workers took to the streets to contest a change to employment law for those under the age of 26. As a result, the Government faced a humiliating retreat and scrapped its plans. Tellingly, Mr Sarkozy, as Interior Minister, did what he could to avoid a clash with the protesters. He is well aware of the risks of introducing something as unpopular as tuition fees.

But as President, Mr Sarkozy has pledged to make public services more efficient and to rein in the power of organised labour. He has included education reform as one of the top four priorities that will be acted on in his first 100 days in power. And to ensure the safe passage of his Bill to grant universities more autonomy, the legislation will be presented to Parliament in the summer when students are safely on holiday.

Francois Fillon, in his first radio interview as Prime Minister, insisted that the Bill would not introduce tuition fees. Nevertheless, he would do well to consider paving the way to allow France's newly autonomous universities to charge fees for overseas students. Such a move would mark a fundamental shift in the way French universities operate overseas and would create a new competitor for British higher education. France has not previously been considered a threat to the UK's dominant position as Europe's largest exporter of education. But should French universities be given an incentive to recruit abroad, this change could have serious economic repercussions for the UK higher education sector - and indeed the UK economy as a whole.

It is estimated that Britain makes £3.5 billion a year from foreign students. The most recent Prime Minister's Initiative has a target of increasing overseas numbers by 100,000 more per year, and universities are already making plans as to how they might spend the windfall such an increase would represent. The prospect of missing out on this surge in recruitment is chilling.

The fact that our universities teach in English and that the quality of our higher education is recognised worldwide has given the UK a competitive advantage. However, by signing the Bologna Agreement, and therefore agreeing that all European qualifications should be considered of equal quality, our claim to a uniquely high quality is eroded.

At the same time, the French are teaching more programmes in English. Such courses are seen as a vehicle for home students to gain a more international education. The benefits of increasing the number of overseas students on these programmes are seen as academic, social and political rather than commercial. And therefore, French universities do not market them aggressively overseas. But if a commercial opportunity emerges, these programmes will become highly marketable products with the potential to generate much-needed revenue for French universities. Revenue that presently, of course, goes largely to UK higher education.

For many UK universities, overseas students provide the largest source of non Exchequer-related revenue. The ability to charge differential fees has changed the nature of their business. Most have developed sophisticated marketing strategies and tactics to maximise this income stream. Their professional approach has paid enormous dividends to the UK higher education system, making Britain the second-largest recruiter of overseas students after the US.

It took more than a decade to embed these approaches to overseas business in British universities. But the French need not take so long. They are already creating programmes that can compete with the UK on an even playing field. They have only to look across the Channel to our success in marketing such courses and emulate it. Given the incentive provided by Mr Sarkozy, they could fast become a major competitor.

Peter Brady is head of the international office at Napier University.