The Great Chinese international student crash begins

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Around a year ago, it became apparent that the six-year boom in Chinese international student enrolments was coming to an end.

Insiders were reporting a slump in visa applications from Chinese students. This was subsequently confirmed by the Department of Home Affairs, which posted a 3.3% decline in student visa applications from China in the 2018-19 financial year:

Visa applications are a leading indicator of enrolments. Therefore, the decline in applications from China portended a fall in student numbers.

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The Department of Education has updated its international student enrolments to August, which reveals that Chinese enrolments have begun to fall, declining by 4.0% from 108,485 in August 2018 to 104,148 as at August 2019:

As shown below, the decline in Chinese international student enrolments has been driven by NSW (-2.6%) and VIC (-6.8%):

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However, while new enrolments are falling, total Chinese enrolments continued to rise, up 2.2% in the year to August:

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Logically, visa applications lead enrolments, whereas new enrolments lead total enrolments.

Therefore, with both visa applications and new enrolments now declining, the signs are clear that the long boom in Chinese international students is starting to bust.

This was always inevitable, given that Australia’s concentration of Chinese international students is by far the highest in the world:

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.