Introduction and Literature ReviewSouth African education policies place priority on addressing historical education imbalances, but should also be sensitive to the demands of an ever-increasing global knowledge-driven environment. The educational system cannot be dominated by the needs of the domestic educational system of South Africa ignoring the trends exerted by the global world (OEDC Annual Report, 2004:44). Higher education in South Africa should realize that they operate and function in a knowledge-driven global environment in which both domestic and foreign students demand access to the best quality education at the best reputable institutions of higher education in the world.In this regard, most definitions of internationalization of higher education include the following: “Internationalisation is a process that prepares the community for successful participation in an increasingly interdependent world … The process infuse all facets of the post-secondary education system, fostering global understanding and developing skills for effective living and working in a diverse world” (Francis, 1993 cited by Patrick, 1997).The position of higher education in South Africa should be evaluated considering the re-integration of South Africa into the global community. South Africa was rapidly re-integrated into the world community by obtaining almost immediate membership of influential international organisations after 1994. Kishun (1998:59) indicated that South Africa became a member of among others the following international institutions: United Nations; Organisation of African Unity; Commonwealth; International Olympic Committee; Federation of International Football Associations; and Lome Convention. Integration of influential international institutions is a necessary but not sufficient pre-condition for internationalization of higher education. Sustainable internationalization should be closely aligned to the emerging global trends and events in the education sector.An analysis of the basis on which internationalization of higher education occurs is needed as well as the benefits of the internationalization process. This research is conducted against this background.Problem StatementWhilst South Africa is in a process of transition regarding higher education to address the imbalances of the past, the question arises whether the South African educational sector is able to compete in the global economy which regard knowledge as a commercialised commodity.MethodologyA sample size of 781 respondents from six institutions of higher education in South Africa was selected. Senior students were randomly selected using the convenience sampling technique. A semi-structured questionnaire was developed to measure the perceived competitive profile of institutions of higher education in South Africa. The questionnaire constitutes five measuring foci, namely:· Section A: Institutional information regarding the location where the respondent is enrolled.· Section B: Biographical information in terms of gender, type of student and country of origin.· Section C: Decision criteria used to select an institution of higher education.· Section D: Four competitive dimensions of higher education institutions, including strategic competitiveness, institutional competitiveness, product competitiveness, and tactical competitiveness.· Section E: Open-ended questions, aimed to identify the reasons why respondents choose a specific institution of higher education, their opinion on the institution’s competitive reputation, and the factors that may influence the international competitiveness of the particular institution.The data was transformed into two opposite categories, namely those who agreed with the statements and those who disagreed, enabling the researchers to derive a hypothesized agreement-disagreement distribution. Those who neither agreed nor disagreed were allocated to the disagreement group set giving and expected disagreement response set of 57% (p=0.57) and an agreement response set of 43% (q=0.43). The Binomial test was employed to determine whether the observed distribution correspond with the hypothesized distribution using a significance test level of 0.05. Furthermore, the level of agreement or disagreement with the selected competitive statements and the extend of agreements between the respondents from the different institutions on the various statements were determined by executing four statistical procedures, namely: ANOVA to compare the means of respondents from the different institutions; determining how much of the perception variation could be accounted for by the influence of the different institutions of higher education; determining the averages for each strategic dimension to obtain an indication of the level of agreement with the competitive statements; and determining the standard deviations to obtain an indication of the extend to which consensus exists within the sample.FindingsWith regard to the strategic competitiveness of South African institutions of higher education to engage in a seamless network the respondents were of the opinion that South African institutions of higher education give low priority to attract foreign students, are not well known for attracting foreign students, are not actively involved in exchange programmes of students and lecturers, and do not have active engagements or agreements with other tertiary institutions, businesses and communities.On the issue of institutional competitiveness, the majority of respondents were of the opinion that institutions of higher education in South Africa have the ability to attract quality students, does not have an international student culture, offers qualifications that are internationally accepted, can claim international reputability on post-graduate level, offers competitive tuition fees, deliver research outputs that are internationally recognized, and are not easily accessible.In terms of product competitiveness the majority of respondents indicated that institutions of higher education in South Africa have active orientation programmes to familiarise foreign and domestic students with the institutions, provide safe and secure learning environments, provide leading information technology for academic growth and excellence, do not easily adapt to the needs and wants of students, and provide convenient service packages to students.With regard to tactical competitiveness institutions of higher education in South Africa have the ability to compile a diploma or degree offering that meets or exceeds international standards in terms of offering subject content of international standard, having internationally acclaimed staff, aggressively marketing its qualifications internationally, claiming international acceptable through-put, and having acceptable grant and loan schemes accessible to students.Conclusion and RecommendationsThe majority of respondents are in agreement that institutions of higher education in South Africa are able to compete internationally on the four competitive dimensions (strategic, institutional, tactical and product). Internationalisation requires that institutions of higher education in South Africa should emphasise a somewhat loosening of the relationship with Government, despite the paradoxical need to create new transformational bodies to address the imbalances of the past. Internationalisation of higher education implies that internationalised institutions operate on new super ordinate levels which has its own legal, administrative and revenue-raising powers.In terms of strategic direction institutions of higher education might consider at least one of the following internationalization approaches:· “Would-be internationalization”: Applies to academics and institutions wanting to be involved in internationalization but facing problems in being considered on equal terms.· “Life or death internationalization”: Countries, their academics and institutions, which view internationalization cooperation as indispensable for their status and role in the global world.· “Two areas”: Academics and institutions have the option of striving for either more national or more international status and orientation. The academic field in which one is operating often determines this.· “Internationalisation by import”: Countries and institutions that treat internationalization only as coming from outside, by hosting foreign students and publishing research. It should not represent a separate strategy towards internationalisation.ReferencesKishun, R. 1998. Internationalization in South Africa. In The globalization of Higher Education. Scott, P. ed. Buckingham: Open University Press.OECD Annual Report. 2004. Education. p.41-45.Patrick, K. 1997. CSDF project full report: Internationalising the University. Melbourne: RMIT.