EDUCATION: Economic Crisis Sends Asian Students Home

By IPS Correspondents Reprint | | Print |

Mohan Srilal

SINGAPORE, Feb 18 1998 (IPS) - The loss suffered by many universities in the United States, Britain and Australia may yet be Malaysia’s gain, if the South-east Asian nation’s plans work out.

The currency crunch is forcing more Asian students overseas to abandon their high-fee university places, and head back home. But while Western universities fret over this exodus, Malaysian officials see in it a chance to push its ambitions to become a regional hub for higher education.

Malaysia has been nurturing that dream since 1996 when it passed the Private Higher Education Institution Act, aimed at the establishment of private educational institutions in the country.

But it made little headway as Asian students continued to make a beeline for universities in the West, especially in the United States, Britain and Australia.

For years, these English-speaking countries have made billions of dollars from hosting foreign students. Foreign students contributed as much as seven billion U.S. dollars annually to the U.S. economy, five billion dollars to the British and three billion to Australian state coffers.

Fees paid by foreign students also help subsidise places for local students, a trend that has been shaping up since the 1980s, when rationalisation policies in the West resulted in the cutting of public education budgets there.

But now cash-strapped Asian parents are summoning many of their children home, and Malaysia is seizing the chance to push its newly-established universities and institutes of higher education as an alternative.

This month, the Malaysian education ministry is launching a roadshow in South-east Asia to attract foreign students. The campaign kicks off Wednesday in Brunei, whose education minister Datuk Abdul Aziz Umar will open the Malaysian Education Exhibition 1998.

More than 40 Malaysian public and private institutions of higher education will join the two-day event, which will coincide with the South-east Asian Education Ministers Council meeting.

“The presence of the other education ministers will be a boost to our efforts to make Malaysia a centre for educational excellence,” Malaysian deputy director-general of education Sri Nusa Ahmad Thaharuddin told the ‘Star’ newspaper in Kuala Lumpur.

Aside from the fact that Malaysia shares similar socio-cultural backgrounds with its South-east Asian neighbours, he said its universities offer ‘twinning programmes’ or educational collaboration with foreign institutions. In other words, students would be getting some education from the West without having to leave Asia.

From Brunei, Malaysia’s educational roadshow will move on to Indonesia and other member countries of the Association of South- east Asian Nations (ASEAN).

Meantime, U.S., British and Australian universities are scrambling to keep as many Asian students as they can.

Some have set up funds to enable Asian students to continue studying there despite the sharp rises in tuition following the plunge of many Asian currencies. Others offer ‘study now, pay later’ schemes, including interest-free loans.

For instance, the University of Denver in the United States has announced a deferral of tuition payments for South-east Asian students. It says students need only to sign a document promising to pay the fees once their nations’ currency situation improves.

Asia supplies 57 percent of 457,000 foreign students in U.S. universities, so any large-scale drop in enrolment would hurt them.

Education authorities fear that Asia’s currency woes may trigger the biggest disruption to the U.S. higher education industry since the Iranian Islamic revolution in 1979, which occurred when 51,300 Iranians were studying in American schools.

In Britain meanwhile, some 54,000 of its 198,000 foreign students are Asians. The biggest number — some 17,000 — comes from Malaysia, followed by Hong Kong, Singapore, Japan, Taiwan, China, Thailand and South Korea.

“This is obviously a serious issue for UK universities,” Diana Warwick, chief executive of the Committee of University Vice Chancellors and College Principals (CVCP), told Singapore’s ‘Straits Times’ recently.

“We are not only concerned about the financial consequences. The contribution students from South-east Asia make to our academic community is highly valued,” she explained.

Warwick University has set up a 500,000 dollar fund to help South- east Asian students, and Nottingham University is putting up a one- million-dollar package. Leicester University, where South-east Asians make up 10 percent of the 8,500 student population, will award bursaries to affected students.

For their part, Australian universities seem to still be in shock over the realisation that they will lose 300 million dollars this year alone as Asian enrollment continues to drop.

As the academic year begins this month, University of New South Wales Vice Chancellor John Niland says his university will have 10 percent fewer students this year. His school has the largest Asian student population in Australia, making up 15 percent of its total number of students.

Some Australian universities and colleges are facing as much as 20 percent drops in enrollment. Falling enrolment could not have come at a worse time for Australian universities, which are still reeling from last year’s 10 percent across the board budget cut by the national government.

In the coming months, observers say Western universities’ efforts to keep Asian students will meet stiff challenge from new policies by Asian governments keen on saving on foreign currency.

Malaysia, Thailand and South Korea have already halted sponsoring study schemes. Kuala Lumpur has been most aggressive in discouraging Malaysians from studying abroad, believing this has been a key contributor to the current account deficit that triggered the attacks on the Malaysian ringgit.

Malaysians make up the bulk of South-east Asian students studying in English-speaking countries. Last year, some 50,000 Malaysians were enrolled in overseas universities, costing the country more than one billion dollars a year in tuition fees and support remittances.