Private colleges need 5 years to recover from Covid-19 impact

The institutions set to fully reopen this month, but now deferred till year-end due to 3rd wave of Covid-19 cases


PRIVATE higher educational institutions (PHEIs), which have relied on international tuition fees before the Covid-19 outbreak, will see the effects of the pandemic for the next five to six years.

Malaysian Association of Private Colleges and Universities president Datuk Dr Parmjit Singh said the impact from international travel restrictions that hindered new foreign intake this year are expected to persist for at least the next three years — based on the average duration of the different courses.

He said even if the Covid-19 pandemic ends, private universities and colleges need another couple of years to regain their footing to recover from the three “empty years”.

“Loss of student enrolments will have a direct impact for three years. Confidence will build up slowly. It is not going to happen overnight after the crisis. We are imagining a recovery cycle of five to six years at the minimum,” Parmjit told The Malaysian Reserve (TMR).

A recent TMR report stated that almost 20% of the 440 PHEIs across the country are at risk of closure this year due to restriction on new foreign students’ intake that has also led to a decline in tuition fees.

HEIs were previously set to fully reopen this month including allowing new and existing foreign students on campus.

The plan, however, has to be deferred until the end of the year due to a new wave of Covid-19 cases. The Immigration Department has postponed the entry of all new and existing foreign students until Dec 31 this year.

“That is a disaster for us, particularly for universities where intake is mainly in the last quarter. The chance of new foreign students to start online is very low,” Parmjit said.

PHEIs take roughly between 20,000 and 30,000 new international students yearly, which account for from 10% to as high as 50% of students in an institution, depending on the business model and courses it offers.

As of September 2019, 70% or 92,415 foreign students were enrolled in PHEIs compared to only 39,099 in public universities, according to Education Ministry data.

The industry players were previously aiming for at least 7,000 to 8,000 new foreign students in September and October.

Parmjit said about 41% of PHEIs in the country were already making losses for the past three years consecutively.

Taking a conservative number out of that percentage, he said around a hundred PHEIs are expected to close this year.

“If they were losing money for the past three years, how are they going to survive this crisis? I do not know how many have closed down to date, but I do know that four had been closed down within a week three weeks ago,” he added.

Parmjit said Malaysia has been an attractive place for foreign students, particularly because of the affordability advantage.

He said not all local PHEIs are competitive in online courses.

“Other universities are constructed to offer online education from day one and they do not go online just because of the crisis. They have an edge over us,” he said.

Higher education management specialist Dr Geoffrey Williams said PHEIs that rely more on international students are those of franchised foreign universities such as British, Australian and Chinese universities.

These types of PHEIs will be impacted more by the decline in new foreign students compared to other outlets.

Williams said the approach of prohibiting new foreign student entry could have a structural impact on the ability to attract international students.

“It is going to have structural effects on Malaysian universities in attracting foreign students. We have to think as an industry on how to respond structurally,” he told TMR.

Williams said among measures that could be taken for Malaysia to be more positive and welcoming is by making it easier and cheaper for international students to come, with minimal bureaucracy.

“We have to compete internationally because universities around the world are struggling and looking at opportunities to attract foreign students. We need to do the same and be ahead of the game,” he added.