Since January 14, the exchange rate of the US dollar against the renminbi has been continuously rising. With the exception of a slight retreat in July, it has continued to climb to $7.3.
“The continuous depreciation of the renminbi may invisibly increase the cost of studying abroad for many international students, as most of them may not have prepared foreign exchange in advance,” said BOSSA in a statement.
It explained how tuition fees are impacted, since these are usually paid in renminbi directly converted at the prevailing exchange rate, whether paid through third-party payment platforms or otherwise.
“If we calculate based on the lowest rate of 1:6.7 at the beginning of the year and assume the tuition is $30,000, then today’s rate of 7.3 would mean paying an extra ¥18,000 compared to the beginning of the year,” said BOSSA.
It added that as the renminbi depreciates against the US dollar, it also continuously depreciates against other currencies, using the British pound as an example.
“If the tuition is £22,000, and the exchange rate was 1:8.13 at the beginning of the year, but now it’s 1:9.3, there would be an additional ¥25,740 to pay compared to the beginning of the year.”
As a result, the membership association has warned that those students, and their families, considering studying abroad should take into account future tuition and living expenses and play close attention to exchange rate trends and exchange currency in the locations they are considering.
Exchange rate fluctuations are likely to persist in the long term
“Exchange rate fluctuations are likely to persist in the long term, and being proactive can save students and families a portion of the costs of studying abroad,” the association said.
The warning comes only days after Grace Zhu, BONARD‘s China branch director, told The PIE that the current economic situation would not have a significant impact on students’ appetite for studying abroad.
“The economic situation itself is not particularly good, and coupled with the impact of the exchange rate, there will definitely be some impact on students choosing schools,” Hanks Han, at Can-Achieve told The PIE.
“More and more students choose public universities. They will increasingly consider things in terms of cost performance.”
Value-for-money is more important than ever now in a time when students returning to China after studying abroad are not guaranteed a decent job with good income, said Han.
Generally speaking, Han believes the mobility of students from upper-class families will not be affected, but the same cannot be said for those from middle-class backgrounds.
Han added that in recent times, he has encountered students in difficult situations including those who have found themselves bankrupt, or their families, and have left the country to find a job.
Meanwhile, James Jing Wang, CEO, Beijing L&J Education Technology, spoke to The PIE from his perspective as an agent sending Chinese students to the UK. He believes that the impact will vary across the different segments of Chinese students studying in the UK.
For students studying a 3+1 program, with a Chinese degree, there will be “medium impact”, he said. Considering the increasing costs of studying in the UK or depreciation of the renminbi, they may rather spend the costs on a master’s program, rather than on a dual bachelor degree.
As for international school graduates looking to study an undergraduate degree in the UK, he told The PIE there will be limited impact since they and their parents are “not price-sensitive”.