BRITISH universities face losing millions of pounds through a sharp decline in students from Malaysia following a shock decision by their government to axe tax concessions for study abroad.
The move, designed to keep more students at home, is expected to have a serious impact on countries such as Britain and Australia which attract thousands of fee-paying Malaysians.
For Britain alone the potential fee income exceeds Pounds 130 million. There were nearly 18,000 Malaysian undergraduates and postgraduates in the United Kingdom in 1996/97.
From January 1998 Malaysian parents sending their children to local universities will continue to receive quadruple child tax relief, but those who send their children overseas will lose the concession of double child tax relief. An estimated 100,000 Malaysians are studying abroad for qualifications ranging from certificates to PhDs , 30,000 on twinning programmes.
Allan Barnes, director of the education counselling service of the British Council, said anything that reduced numbers was going to hit universities in the UK.
"Institutions have been aware that numbers from Malaysia are at their peak and only likely to go into decline from now on," he said.
David Baker, of Leeds University, said: "The big universities draw their overseas students from around the world and have a wide spread. But we are going to have to look elsewhere to fill the gap. We can't stand still."
Newer universities could be particularly hard hit, he said.
Numbers of self-funded Malaysians in the UK have increased rapidly, from 5,000 in 1994 to more than 6,500 this year.
Deputy prime minister, Datuk Seri Anwar, said removal of the concessions would encourage more students to go to local institutions and reduce the outflow of Malaysian capital abroad.
One senior Australian university official said the move was likely to have a more long-lasting and serious impact than the recent currency crisis, and vice chancellors feared other Asian nations could take similar action.
Malaysian newspapers have reported parents saying they will review plans to send their children abroad. Others may send their children to institutions with twinning arrangements with overseas universities so they can still graduate with a foreign degree.
Datuk Anwar told parents to send their children to Malaysian universities instead. "Our universities have all the requirements, capabilities and skills needed for first degree programmes", he said.
Private colleges called on the government to extend the decision to include parents who opt to send their children to local institutions with twinning arrangements.
Most parents send their children abroad because applications to local universities are unsuccessful or they are not offered places in their preferred subjects. Chinese and Indian-Malaysians are subject to admissions quotas which give preference to Bumiputras (Malays). C. W. Watson, an expert on Malaysia at the University of Kent, said many self-funding students go overseas because of quotas in law, medicine, accounting and business departments at the best universities.
Numbers of Malaysian Students in the UK
1994/95, 1995/96, 1996/97
Postgraduate self-funded 1644, 1697, 1768
Postgraduate overseas-funded 1929, 2106, 1640
Undergraduate self-funded 4959, 5656, 6537
Undergraduate overseas-funded 4487, 6143, 5183
Source - HESA