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The origin of City University of Hong Kong is that in the years after the establishment of the Hong Kong Polytechnic in 1972, people called for the establishment of a "second polytechnic". In 1982, Zheng Shiyuan, a member of the Executive Council, talked about the general consensus that “a second technical school similar in scale to the first should be built as soon as possible”. The chief executives of Tuen Mun and Tsuen Wan have lobbied the government to establish new institutions in their respective new towns. The government instead purchased a temporary house in the second block of the new Argyle Street Centre in Mong Kok, which was developed by Mong Kok. The Mass Transit Railway Corporation cooperated with the then Argyle Station. The new school is called the City Polytechnic of Hong Kong, and the name was chosen from nearly 300 suggestions made by the public.
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The new Polytechnic opened on October 8, 1984, welcoming 480 full-time students and 680 part-time students. Allocations for part-time students contributed to high enrollment rates and almost immediately filled the quota.
Percy Thomas Partnership won the construction contract to design the new campus together with Alan Fitch and WN Chung. It was originally scheduled to open in October 1988. The first stage was officially opened by Governor Wilson on January 15, 1990, with 14 lecture halls and 1,500 computers. By 1991, the school had more than 8,000 full-time students and approximately 3,000 part-time students. The second phase of the permanent campus opened in 1993. The school was granted university status in 1994 and its name was changed accordingly.
In April 2015, the university suddenly and controversially closed its MFA course in creative writing. Students and alumni initiated a petition against the decision, and the college and a well-known international writer issued an open letter questioning the reasons for the closure. Madeleine Thien, a famous Canadian novelist and teacher who published an article in The Guardian, is one of those who attributed this decision to censorship and reduced freedom of speech in Hong Kong.