Exchange Rates Affect International Education
November 2nd, 2013 by Jennifer Frankel
In the world of international education two giants stand tall: China and India. It should come as no surprise that the world’s two most populous nations – and, indeed, two of its emerging superpowers – contribute more international students than any other countries on the planet. From there, however, the stories diverge. While recent economic trends have seen the value of the Chinese Yuan rise in recent months, the opposite is true for the Indian Rupee and all this has both international students and centers of higher education worried.
Since 2007 (when China began to alter its currency regulation policy) the value of the yuan has risen by almost 60% against the British Pound. As a result, studying abroad is now cheaper than ever for Chinese students and indeed a record number are doing exactly that: the 2011-12 academic year saw a 17% rise in Chinese student enrollment in the UK. Indeed, more than one in four non-EU internationals students in the UK hailed from China. While this may seem like a promising trend for educators, many are concerned that schools are becoming too reliant on – and therefore vulnerable to – a single source of students which could be affected by policy or economic changes.
It is exactly that kind of economic change that is currently affecting many of the approximately 800,000 Indian students who travel overseas to study each year. For them the math is much less favorable: a falling rupee means that their costs have risen by as much as 20% among their top three destinations (the UK, US, and Australia). As a result many are beginning to wonder if they can still afford to go abroad at all.
This is particularly troubling for many academic institutions in the US who, thanks to the fact that international students typically pay higher tuition than their domestic peers – have come to rely on the unique economic contribution of international students. As a result it is not just these students but also the institutions they apply to, too, that will be keeping an eye on the exchange rate in the months to come.