OTTAWA — Moody’s Investors Services says three of Canada’s biggest universities would face a cash crunch if Canada’s diplomatic row with China results in the world’s most populous nation pulling its students from Canadian schools.
Tuition for international students is much higher than that charged to Canadians and has become a “crucial” source of income for schools, Moody’s says.
China has made no moves to cut off student travel to Canada but Moody’s says there is a risk posed by the escalating diplomatic fight since Canada arrested a senior executive from Chinese telecommunications giant Huawei.
The Moody’s warning comes several months after a dustup between Canada and Saudi Arabia resulted in the kingdom yanking the scholarships of Saudi students studying in Canada.
The impact of such a move by China would be far greater, Moody’s warns in its report, because there are 15 times as many Chinese students in Canada.
Moody’s notes Chinese students make up nearly two-thirds of the international student body at the University of Toronto, more than one-third at the University of British Columbia and almost one-fourth at McGill University.
“The intensification of political tensions between the Government of Canada and the Government of China poses credit risks for Canadian universities,” the Moody’s report warns.
When Saudi Arabia cut scholarships the Council of Ontario Universities warned Ontario schools alone would lose tens of millions of dollars, without adding in the overall economic impact from the students in terms of housing and living costs.
Global Affairs Canada reported that in 2016, international students spent more than $15 billion in Canada.
Immigration, Refugees and Citizenship Canada statistics for 2018 show more than 77,000 Chinese students held study permits in Canada. In 2017, before Canada angered Saudi Arabia by calling for the immediate release of human rights activists the Saudi government had arrested, there were 5,090 Saudi Arabian students with Canadian permits.
That number fell to 2,720 in 2018.