Coronavirus exposes western universities’ reliance on China

Sonia Gao is one of 200,000 Chinese students studying in Australia — a group that has helped transform the nation into an international education superpower worth A$37bn ($25bn) a year.

But like many of her compatriots, she will not be able to start the new academic year that begins next week. Australia, the US and New Zealand are among more than a dozen nations to impose a ban on entry to anyone who is neither a citizen nor a permanent resident if they travelled in China within the past 14 days. The measures, aimed at containing the spread of the coronavirus, pose a multibillion-dollar threat to western universities, which have become increasingly reliant on income from Chinese students. “Australia seems like it has the toughest attitude to overseas students. Some students could reconsider their places if the situation doesn’t change,” said Ms Gao, who was due to fly to Sydney on February 9 but is stranded in China along with 100,000 other students with places at Australian colleges and universities. Universities in North America and Europe have also increasingly relied on income from Chinese students. Many have been forced to suspend classes with Chinese students stranded abroad or in quarantine, and to provide alternative tuition online — many are watching to see whether the next round of applicants will be reduced with entrance exams delayed. “We are teaching 400 Chinese students online and have cancelled recruitment fairs,” said Gianmario Verona, rector at Bocconi University in Milan. “It is potentially an issue for this coming academic year.” The number of Chinese studying overseas has doubled to 869,000 in the decade to 2017, according to the Sydney-based Centre for Independent Studies think-tank. In the US, there were more than 300,000 Chinese students in 2018-19, according to the Institute of International Education. In the UK, more than 86,000 Chinese enrolled in higher education last year. Australia is still more vulnerable: one in 10 students at its top eight universities is Chinese, the highest ratio in the developed world. The International Education Association of Australia warned this month of a A$6bn-A$8bn hit if Chinese students could not attend the first term. “The coronavirus epidemic has exposed Australian universities’ unparalleled exposure to the China market,” said Salvatore Babones, associate professor at University of Sydney, who wrote a recent report on the risk of an overreliance on Chinese students. At his university alone, they generated about A$500m in fees in 2017 — almost a quarter of its A$2.3bn revenue. The recent travel bans sparked protests this month in Sydney and Melbourne, with concerns about racism underpinning the move. “There is no doubt this is damaging Australia’s reputation among Chinese students,” said Abbey Shi, general secretary at the University of Sydney’s student council. “They are angry and some are already diverting their plans to study in Canada, UK or elsewhere. No one wants to pay A$40,000 a year to end up doing online courses back in China.”

Universities Australia, which represents the sector, played down the long-term damage. “I have not heard of any evidence of cancellations. I think students are still in the process of assessing what their options are,” said Catriona Jackson, its chief executive.

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US universities began their spring term in mid-January, which means most students had returned from China before the travel restrictions were imposed. Still, some have complained about the stigma created.
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Yinan Dong, a graduate student at Columbia University in New York, said: “A strict ban will help stop the virus spreading. But we also noticed that a lot of people . . . are very unwelcoming to people from China.”
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Ucas, the UK’s university clearing house, said it had not yet observed a dip in Chinese student applications, adding that extensions “will be considered” to the usual deadline for exam results by the end of August. Analysts pointed out that the coronavirus hit to universities comes as they are already suffering because of trade tensions between Washington and Beijing. The Trump administration has tightened visa rules on Chinese graduates of science, technology, engineering and mathematics. Some US universities have taken out insurance policies against a potential drop in overseas students. A number of Australian universities unsuccessfully sought similar cover, and have been trying to diversify their international student intake. Monash University said recently that it had become the first foreign higher education institution authorised to open a fully fledged branch campus in Indonesia. Other institutions are targeting Malaysia, India, Thailand and other Asian economies. But critics said these efforts would not prevent financial hardship. “Diversification won’t solve that problem,” said Mr Babones. “There aren’t enough international students in the world to substitute for Australia’s China exposure. The only solution is for Australian universities to dial down international student numbers to more reasonable levels.”

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