Anticipated drop in international students likely to hit Australian universities

Summary

• China’s education ministry has told potential students to evaluate the options carefully when going for studies, noting racial abuses in Australia.
• Australia-China relationships have been deteriorating this year, and Beijing is not pleased with the stand taken by Australian policymakers.
• Universities’ revenues are already at risk due to COVID-19, and China’s boycott could be a double whammy.

China has been running in troubled waters since the COVID-19 pandemic broke out in the country, with the novel coronavirus crippling to most of the world now. Communist Party of China grew increasingly uneasy with the demand for an independent enquiry into originations of COVID-19 led by Australian and joined by global leaders from several nations.

In response to the Australian actions, Chinese Officials responded with a ban on beef facilities and imposing hefty tariffs on Australian barley. Of late, China, which is the largest trading partner of Australia, has been upset with Canberra for disagreements, including a ban on Huawei’s 5G component.

At the backdrop of COVID-19, the global community has grown sceptic for China. Countries are moving supply chains out of China, and nationalistic spirits are charging higher in most of the world.

China has also been irked by several legislations passed by the US Congress, including the most recent Uyghur Human Rights Policy Act, Holding Foreign Companies Accounting Act, and Honk Kong Human Rights and Democracy Act.

Back home in Australia, the relations with the United States of America remains firm, which is also a worry for the Chinese Communist Party. And it is not only the US relations – Australia’s ties with Japan & India has been strengthening – which might have mocked the top bosses at the helm of the single-party nation, China.

There is no denying the fact that racial abuses have been on the limelight this year. People have grown uneasy with the Asian race, deeming them Chinese and a source of COVID-19. Australian media has tracked stories of the victims that have faced racists slurs from people, who may not even know whether the victim is Chinese.

China boycotting Australia is gaining momentum

Last week, the Chinese Education Ministry urged students to reconsider their decision to study in Australia, citing racial abuses to the Chinese. Ministry said that Chinese people had been the victim of racial injustice.

Chinese Officials are also displeased with Australian politicians to have labelled COVID-19 as ‘Chinese Virus’. Students were told to take a thorough risk assessment prior to applying in Australian Universities.

They said people of Asian descent had been a victim of racial abuses in Australia. Australia has also been critical of the legislation passed by China for Hong Kong. According to the Department of Education, Skills and Employment, around 261k Chinese students arrived in Australia for studies in 2019, constituting a 27.3% share (largest) across all nationalities.

After China, Australia welcomed around 144k students from India, followed by Nepal, Brazil, Vietnam. The country also recorded impressive year-on-year growth in incoming students from the Philippines, Saudi Arabia, Sri Lanka, Pakistan, Mongolia, India, and Colombia.

University Australia (UA) estimates that COVID-19 could cost $16 billion to the Universities in Australia between now and 2023. The University expects revenues to be in the range of $3.1 billion to $4.8 billion. They have estimated this amount for a few years from now.

Education has played an essential role in the development as well as economic growth of Australia. Universities not only provide high-quality research to tackle the crisis like COVID-19 and bushfires, but these institutions also support employment in the country and mould the next generation of skilled workforce.

The Universities’ body noted that domestic institutions have been responsible for development and employment. Australian higher education institutions have developed vaccines for cervical cancer, soft contact lenses, IVF, and treatment for burns.

With revenues poised to go down, the ability of Universities to invest in high-quality research for innovation will likely be impacted. Research and development deliver long-term economic benefits to an economy, which seems to be at risk at present. As per some estimates, $3.3-$3.5 billion worth of annual R&D activity might be at stake.

Media reported that experts believe job losses across the Australian higher education institutions may reach tens of thousands. The University of Central Queensland has already moved with lay-off plans and closure of some sites.

University of New South Wales expects to report losses up to $600 million in 2020 as well as in 2021 and 2022. It is exposed to the risks of travel bans due to a large number of international students opting for the University. Several universities have also indicated potential lay-offs, salary cuts, delay in capital expenditure.

Recently, Prime Minister Scott Morrison had confirmed that the Government is looking at the revival of studies in the country with a safe return of international students. University Australia told that return of international student will require collective efforts of the stakeholders, including State Governments, Universities, Healthcare Authorities.

UA also noted that international education in Australia contributed $39 billion to the Australian economy, and supported 259k jobs.

China has also warned tourists

In a similar warning to potential students, China’s Culture and Tourism Ministry issued a warning to its citizens to avoid travelling to Australia in the wake of growing racism against those of Asian descent in the country.

NOTE: $ denotes Australian Dollar unless stated otherwise.