Australia’s international student and tourism China boom is over

By in Australian Economy

| 24 comments

Over the past five years, Australia experienced a massive boom in international student numbers, whereby the number of student visas on issue ballooned by around 200,000 to half-a-million as at the end of 2018:

As shown in the next chart from The ABC, this international student growth has been driven by the Chinese, whose numbers have surged from around 95,000 in 2015 to 150,000 as at 2018. Chinese students also accounted for around $11 billion of Australia’s $32 billion in education export earnings in 2018:

Recently, we have received explicit warnings that Chinese students numbers have peaked and will likely fall into the future.

Last week, The Australian reported that “the highly lucrative six-year boom in Chinese students is over”:

Ahead of the release of official figures, a senior Department of Home Affairs official briefed universities last week telling them that visa applications from Chinese students were flat…

The flattening out in numbers of Chinese students starting courses is not yet visible in the monthly data issued by the federal Department of Education and Training.

The March figures, which will give the full picture of international student enrolments this year, are not yet available.

Whereas University of NSW Professor, Ian Jacobs, recently warned that Chinese student numbers will decline over the coming decade:

“They are getting more universities, and those are getting much better quality, very rapidly,” said Professor Jacobs. “The Chinese government understands education is everything if they are going to be the high tech country they aspire to be.”

“My assessment [is] over a 10-year period, [Chinese students] will gradually decrease. We are already starting to see a slight decrease in the number of undergraduate students from China as the opportunities increase.

March’s overseas arrivals and departures data from the Australian Bureau of Statistics (ABS), released on Monday, supports these assessments. It showed that short-term arrivals from China declined for nine consecutive months, including both students and tourists. Moreover, arrivals in March 2019 were lower than August 2017:

There are a variety of possible reasons why the flow of Chinese students and tourists has stalled.

As noted by Ian Jacobs above, China is increasing investment in its own universities and lifting its standards. At the same time, Australian university standards have plummeted, as highlighted in last week’s Four Corners expose, which has no doubt eroded the prestige-value of an Australian degree.

Political tensions between Australia and China could also be reducing the flow of Chinese students and tourists. China may also want to keep more of both at home to prevent the outflow of capital and protect the value of its currency.

Increased competition for Chinese students from other Anglo nations could also be having an effect. Last month we learned that the Canadian Government plans to expand its presence overseas in order to significantly increase the volume of international students studying in Canada from 572,415 in 2018. The UK Government is also seeking to lift international students numbers by offering more generous work rights.

Unlike with commodities, Australia has no natural advantage in university education. Therefore, increasing competition from universities abroad (including from China) will make it increasingly difficult for Australia to maintain Chinese student numbers.

The policy response so far has been to pivot to lower quality students from Indian and Nepal, where instances of plagiarism, academic misconduct, and students failing their courses are more common. And with this pivot, Australian university standards will be lowered even further.

The response for tourism is anybody’s guess.

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Comments

  1. MatthewMEMBER

    The number of Chinese student visas rejected by the The Department of Immigration and Border Protection has increased by approximately 11% over the past 3 years. China is categorised at a Level 3 Risk Assessment Level, the highest possible. Approval rates are only 67%, even lower offshore. This should be added to the reasons why numbers have stalled.

  2. Timmeh

    For tourists, Australia must be becoming less attractive. Not only are we at the arsehole of the world, we are ruining what used to make the country unique. Visit any of the cities and they are overpriced, overcrowded sh1tholes with nothing much to offer. I love travelling this country, but it has to be by car, and camping to get the best experience. If you don’t like the wide open spaces of this country then really it has nothing to offer. If you stay in hotels and fly between cities it is expensive as fvck and you just see the same sh1t shopping centres and overpriced restaurants wherever you go.

    • jollyrodger

      You are spot on that we are ruining the things that tourists come here for. I mean we had spectacular unspoilt scenery that attracted people and we are doing our best to spoil it. Now what do we offer?
      * Melbourne thinks it is a progressive European style city, it is not
      * Sydney thinks it is an international city like London or NYC, it is not
      * Brisbane thinks it is a new world city, WTF does that mean?
      To me, the best places to visit now are Adelaide and Tasmania, although the latter is getting much more expensive than before.

    • SaCo

      You forgot the shallow sea where the Great Barrier Reef used to be. The gum forests in NSW which used to house koalas. The overgrazed badlands and the puddle fka the Murray river are probably not on the tourist bucket list.

  3. Jacob

    47 nations have more people than Nepal does. The fact that Nepal is the 3rd biggest source of “students” into AUS indicates that something is very wrong.

    Nepal’s 2nd richest man lives in AUS. He has been the CEO of Melbourne Institute of Technology since 22 May 2014. He must be showing a mirage to “students” from Nepal in order to get 28,000 of them here.

    Is there any data on how many “graduates” are deported from AUS every year?

    • DingwallMEMBER

      “help ensure a model society in which “sincerity and trustworthiness become conscious norms ….”
      LOL well good luck with that …….

      Although ……….. I like this part for those who seem to love walking their dogs on beaches with signs everywhere or those who take them unleashed into bloody National Parks …………….”like walking their dogs off-leash, can have their dogs confiscated and be required to take an exam to get the pets back.” Should include serious fines as well……

      • Jarrod

        I would happily tolerate the rest of the issues with a social credit system if it included harsh punishments for anyone that does not clean up after their dog goes for a dump on the street.

  5. JohnR

    Never understood why the Australian taxpayer puts up with extreme numbers of foreign students in our “public” institutions.

    • steve99

      So that landlords can have tenants, so that University deans can pocket $1Million+++ unearned wages, so that Students parents will buy their kid (on paper) a high rise harry apartment and the government makes a mint out of visa applications.

    • Ino

      Of course, at least our Harold can sing. What has Khumar done for us lately? Uh… don’t answer that!

  7. PassingInterest

    Could also be that those students are finding that they are less than 100% welcome here once they step outside of their Purpose Built Student Accommodation and campus bubble.

  8. rob barratt

    Well, with our standards so low as to guarantee everyone passes, my understanding is that an Australian degree is now valued on a par with the Confederate dollar.
    Hardly a surprise the world is going elsewhere for serious education.
    As for NAPLAN: X X X
    Q: How many Xs can you see on the above line?
    Congratulations – you’re going to Uni….

    • Jumping jack flash

      everyone goes to uni, its the Australian version of “college” that has been sensationalised by the US for about 50 years.

      Its no longer the stuffy UK version of “university” where you had to wear funny robes and hats in class all the time. Only at graduation you see a small amount of that, but its highly Americanised.
      I’m sure everyone throws their mortarboard in the air and there are regular moonings now as well.

      • steve99

        They ‘graduate’ from primary school now you know. Kinder too if you saw any of the pics re that dodgy make believe one that just got caught in Sydney

  9. Willy2MEMBER

    – I would assume that the “recession” in China is also having a negative impact on the amount of students. The parents of those students simply can’t afford it anymore to let their children study at australian universities.
    – Hint for Ian Jacobs: If the chinese are indeed improving the quality of their universities then it’s time for our universities to do the same. But that’s not what our Mr. Jacobs wants want, right ? Because then he must get rid of A LOT OF (well-)paying “clients’. And that is going to hurt the pocketbooks of the universities.
    – How ironic. The UK wants to increase the amount of students but they want to reduce the inflow of migrants as well.