South Australia has $700m in Chinese student revenue at risk as Beijing raises tensions with new racism warning

As China tells international students to rethink studying in Australia because of supposed racism, new data reveals how much Adelaide’s three universities – and SA’s economy – are financially exposed.

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• The impact of losing international students from our unis

South Australia faces an economic hit of more than $700 million if Chinese students heed Beijing’s warning to rethink studying in Australia.

While about 62 per cent of the 177,442 Chinese students with visas to study in Australia are already in the country, there are fears the Ministry of Education’s warning on Monday could cause a drop in future enrolments.

About 40 per cent of the international students who flock to SA each year are from China.

They contributed more than $700 million of the $1.92 billion international students pumped into the state’s economy in 2018-19.

And given state government estimates that each overseas university student injects about $50,000 into the economy per year, SA could be facing a multimillion-dollar hit if even one in 10 Chinese students opts not to return.

It would be a “multibillion-dollar hit” nationwide, according to Peter Hurley from Victoria University’s education policy think tank the Mitchell Institute.

It has already estimated the university sector could lose up to $19 billion from lost international student revenue over the next three years due to COVID-19.

“Most Chinese international students go to universities in Melbourne and Sydney, so these will be the hardest hit. However, there are high numbers of Chinese international students everywhere,” Mr Hurley said.

University of Sydney researcher Salvatore Babones, who last year named the University of Adelaide as one of seven Australian universities who have “extraordinary levels of exposure to the Chinese market”, said Chinese students would likely take government warnings about studying in Australia with a “grain of salt”.

“They know that accusations of racism in Australia are pure propaganda, and they can follow our coronavirus numbers for themselves,” he said.

Australian Strategic Policy Institute director Peter Jennings said the Communist Party wanted to focus attention away from its failure to handle COVID-19, and away from its failing economy.

“Beijing, is trying to make an example of Australia, but the party’s assertive nationalism is losing China friends and trade partners everywhere,” he said.

Trade Minister Simon Birmingham said it would be a “loss to both nations” if fewer Chinese students came to Australia.

“We’re open to continuing to work through difficult issues and we ought to continue to encourage engagement with our businesses, students and others,” he said.

Beijing cited racism and the ongoing risks of the “global pneumonia outbreak” in its message to students on Monday.

The pointed warning was targeted at Australia – despite the nation having fewer than 460 active cases of COVID-19 – rather than at countries where the outbreak remains largely uncontrolled.

China’s Ministry of Education advised all overseas students to “do a risk assessment” and said it was “currently cautious” about studying in or returning to Australia.

Education Minister Dan Tehan said: “We reject China’s assertion that Australia is an unsafe destination for international students. Our success at flattening the curve means we are one of the safest countries in the world for international students to be based in right now.”

Universities Australia chief executive Catriona Jackson said: “This is a matter for the governments of Australia and China.”

SA was already poised to lose almost two billion dollars in income from international students stranded by the coronavirus over the next three years, but China’s warning is likely to hit revenues even further.

Originally published as South Australia has $700m in Chinese student revenue at risk as Beijing raises tensions with new racism warning