UK faces Gulf crash

Student recruitment efforts worldwide are suffering from crises in the Middle East and Asia

British universities and colleges are bracing for a new overseas recruitment crisis - in the Gulf.

As vice-chancellors and their international office heads prepared to discuss how to protect recruitment interests in South-east Asia, British Council officials warned that a Gulf war would demolish years of investment in a rapidly expanding market.

In 1996-97, British higher education institutions provided places for 8,498 students from the Middle East -more than they were taking from Hong Kong or Singapore, or the combined total from Indonesia, Korea and Thailand.

Of the South-east Asian countries hit by currency devaluation, only Malaysia provides UK higher education with more students and fee income than the Middle East.

According to Allan Barnes, head of the British Council's educational counselling service, military action in the Gulf would blow a gaping hole in institutions' efforts to broaden overseas recruitment in the face of an expected fall in numbers from South-east Asia. Mr Barnes said: "The one thing we really do not want now is military conflict in the Gulf. It is a rapidly growing market that we have been working hard to build up."

Mr Barnes, who is coordinating a British Council conference on March 5 focusing on how the Asian currency crisis is affecting recruitment, said the Middle East was one of several important new markets, including China, India and Brazil. Institutions hope these will help bridge a multi-million pound fees gap expected to be left as South-east Asian students quit or stop applying for courses costing them up to 50 per cent more because of currency devaluations.

The latest figures from the Universities and Colleges Admissions Service, along with soundings from British Council directors based abroad, have been more encouraging than expected. A 23 per cent drop in applications from Malaysia was little surprise, as tax changes imposed by the Malaysian government were designed to cut state-backed study abroad. Against this, there was a slight rise in applications from other South-east Asian countries.

But there is still cause for concern, Mr Barnes said. "The state of applications at the moment does not necessarily reflect the number of students we are likely to get turning up. The reality is that if a student is being asked to pay up to 50 per cent more and they were already at the margins of their ability to pay then they may not be able to continue."

Institutions also worry that they may lose ground to Australian universities, whose courses look more competitive because Australia's dollar has moved less against the Asian currencies.

Many UK institutions are offering special bursaries to South-east Asian students to help them cover costs. Warwick has established a Pounds 500,000 scholarship fund; Hull has allocated Pounds 1.3 million for 50 students; and Liverpool has also offered 50 scholarships as well as creating a fee scheme linked to the exchange rate.

Tony Pearson, director of the international office at Leicester University, which has introduced bursaries worth up to Pounds 1,500 next year, said it was possible some Asian students would cut costs by spending their first year studying at home.

Meanwhile the British Council has been talking to the Department of Trade and Industry and the Foreign Office about establishing a national support scheme for South-east Asian students.

It also hopes to encourage institutions to develop distance learning courses overseas by offering promotional and administrative support.