Australian universities not only offer their services to domestic students but a growing number of international students, with some relying on foreign student fees to pay for their services and deliver effective education to Australian citizens.
As an Australian national with businesses in Latin America, I have noticed an increase in the number of LATAM students in the country and the number of Australian universities targeting LATAM school leavers.
Below, I offer my opinions on why Australian universities are looking towards Latin America for new students, and how businesses – both in the educational sector and across a whole host of industries – can benefit from an influx of new international students in their local area.
Growing international student levels
Across Australia, universities spend millions of dollars promoting their services to school leavers and students in countries around the world. In 2018, some universities in the country were criticised by the New South Wales auditor general, who said that universities have a ‘market concentration risk’ because of their reliance on overseas students.
According to their report, revenue from overseas students fees increased by 23% in 2017 in New South Wales, generating more than $2.8bn – 28% of NSW’s total university revenue. That’s an impressive figure and demonstrates the demand for quality education from students around the world.
Australia isn’t alone in its ability to market degrees and courses to students from other countries. Across the globe, there’s a growing number of international students, many of whom fall into the “degree-mobile students” and have no permanent fixed place of residency.
Instead, these students hold a visa and peruse a degree in the country. Figures from the Migration Data Portal show that the number of ‘internationally mobile students’ has increased from 3,960,000 in 2011 to 4,850,000 in 2016, a huge leap and a sign of things to come.
Attitudes toward international travel
There are a whole host of reasons why students choose to study abroad, but the most obvious is that they can see the world as they study. Today’s millennials value experiences more than they do money, and so choose to travel to countries where they can earn a degree and spend time exploring natural wonders at the same time.
Education is another reason why students are choosing to study overseas. Many want to experience a different style of education from that of their home country, whether that’s a stricter or more relaxed form of study, which may better suit their style of learning and allow them to develop unique skills.
Other reasons why students are increasingly heading abroad to study is to take in new cultures, improve their language skills, broaden their career horizons, or find new interests and make new friends. Personal development is another reason, as is the admissions process which is often easier in some countries.
Australian universities are no doubt latching on to all of these reasons when marketing their courses overseas, and Latin America is their next target, particularly students who want to work in the West to increase their salaries and quality of life. By studying at an Australian university, it’s possible to build those bridges.
Reduced reliance on China
As more and more universities increase their reliance on foreign students, Australian firms will no doubt want to protect their businesses and ensure they are not overreliant on one country. Reports suggest that just a handful of countries make up the number of foreign students in Australia, with China coming out on top.
Indeed, 54% of all international students in Australia are from China, with India and Nepal coming in second and third places. Whilst Chinese consumers typically have a high level of disposable income (2017 GDP per capita was US$8,826.99 and middle-class membership measured at 31%, or 420 million people), the country has been going through political and economic challenges in 2018 and into 2019, so parents may choose not to send their children to Australia to save money for their future.
By diluting their international student percentages and encouraging citizens from Latin America amongst other countries to study in Australia, universities can reduce their levels of risk and ensure long-term profitability and consistency within international markets. Whilst companies may have relied heavily on China in the past to prop up their student numbers and coffers, it makes sense to take a more sensible approach as we head into new times.
Growing middle classes
As China’s unemployment levels rise and fears over a recession in the country increase, the picture in Latin America couldn’t be more different. Of course, not every LATAM country has had it easy of late, with Brazil and Argentina two of the victims, but some countries have been registering high levels of growth and rising middle-class citizenship, which leads to higher levels of disposable income, allowing parents to send their children abroad to study.
Across Latin America, the middle class has grown by an incredible 50% in the past decade as foreign investors pump money into the country and governments increase their spending to ensure growth. Today, 30% of Latin America can be considered middle class, which is good news for overseas companies like Australian universities, whose current clientele have struggled. Indeed, Europe and China have seen their economies contract in recent years.
How can you benefit?
Whether you’re the head of a university, you offer your own educational program or your business is entirely unrelated to education, you can benefit by establishing a local company in Australia. Indeed, as the country’s population rises and students look for products and services that they’d usually find at home in Latin America, demand for goods will increase, and you can enjoy long-term profitability and consistent levels of growth as a direct result.
I have seen first-hand how international business expansion can benefit businesses big and small, so would urge you to get started on an Australian venture today. Granted, you’ll need some startup capital and be able to spot a gap in the market, but with the right strategy, you could be on to a winner. If you do choose to get involved, I wish you the very best of luck!
Craig is a seasoned business professional in Latin America. He is the Managing Director and Co-Founder of the Biz Latin Hub Group that specializes in the provision market entry and back office services in Latin America. Craig holds a degree in Mechanical Engineering, with honors and a Masters Degree in Project Management from the University of New South Wales. Craig is also a military veteran, having served in the Australian military on numerous overseas missions and also a former mining executive with experience in various overseas jurisdictions, including, Canada, Australia, Peru and Colombia. Craig lives and manages the Biz Latin Hub Group from Bogota, Colombia.