What U.S.-China trade war could cost U.S. colleges
The U.S.-China trade war in 2018 could stem the flow of international students, costing American colleges and universities more than $1 billion in lost tuition revenue, a new study has found.
U.S. colleges and universities could lose 30,000 Chinese students and $1.15 billion, according to the report from the Center for Global Development.
Coronavirus-driven proposals to restrict student visas could drive the losses even higher. “The ongoing trade wars with China, and policy proposals to suspend or terminate student visas … suggest a bleak future for international students hoping to study in the United States,” the report’s authors write.
The Trump Administration announced last week that international students may be barred from the U.S. if the colleges and universities they attend offer only online education.
Harvard Universities and the Massachusetts Institute of Technology have sued to block the rule.
The full-tuition often paid by Chinese students also enables college and university leaders to better manage tuition increases for domestic students, the study says.
Before the trade war
As a result of China joining the World Trade Organization 20 years, more families there became able to afford U.S. college tuition. American institutions of higher education then experienced a 500% increase in Chinese students, which accounts for half the growth in international students.
The increases were felt across U.S. higher education, as Chinese students began enrolling in less-selective, regional institutions, the study found.
And colleges and universities are not the only beneficiaries—the U.S. government estimates that international students have contributed over $40 billion in spending to the U.S. economy. Tuition from Chinese students—or the “export of higher education”—also helps the U.S. compensate for its trade deficit with China in physical goods.
But the trade war and looming visa restrictions will likely reverse the flow of Chinese students, which has been decelerating in recent years, the authors of the study found.
The annual growth of Chinese students has fallen below 5%, after averaging more than 20% between 2007 and 2013.
Impacts of the trade war could be compounded by improvements at Chinese universities, along with improving job prospects there compared to the U.S., the study concludes.
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