Brexit: Does international students benefit from the fall of pound?
International students face a higher cost of devaluation of pound making them more inclined to accept what they spend rather than fight for more.
The lower pound may discourage inflows, because it reduces UK pay levels in foreign currency terms and make the imports more expensive. After Brexit vote, the exchange rate of pound has slumped about 19 per cent against the CNY, but residences spend higher on daily expenditure.
Few economists believe that high inflation may sustain for a long term. This phenomenon not only affects the UK residence daily expenses, it also makes dramatic influence on students who studied or plan to study in the UK.
When Amanda Liu, a Chinese student who is now studying marketing in the UK, decided to study further in her last year of undergraduate, Durham University was one of her preferred choice, “when I heard of the devaluation of pound, I was quite excited because that means it could save a sum of money, not only the tuition but also daily spending,” but a few days later she received an email from Durham University, “it said that the school would rise the tuition, my original tuition was 1,850 pounds, later it rises to 1,900 pounds.” Amanda adds that she heard that some of her peers who applied to the UK postgraduate program also receive such request email.
Besides the increase of tuition, living expense has not fall, on the contrary, it continues to rise. “I heard from my friend who lived in Victoria Hall (a British student accommodation chain) in Glasgow from 2012 to 2013 that the letting price was just around 100 pounds per week for a shared accommodation type, including private ensuite bedroom with shared living space for group of 5 and 6,” Ovilia Yang says, a MA JMC student from Cardiff University, while the Victoria Hall accommodation homepage shows that the rent price in Glasgow during 2017 and 2018 is 150 per week per person for such type. Within 5 years, the student accommodation fee has increased dramatically by 50 per cent.
The depreciation of pound will have an impact on goods prices, as a result of imports, especially for clothing and electrical. It is said that the UK spent 474 billion pounds on importing goods and services from foreign countries containing Germany, China, France and the US in 2015. Therefore, the devaluation of pound means that the bid of these imports would raise, coincidentally, the price of such goods will be higher.
“But such raise would not happen immediately as retailers buy the foreign currency they need to pay imports in advance,” says retail analyst Maureen Hinton of Verdict Retail when interviewed by BBC news. It is unavoidable that if the fall in the value of pound continues, supermarket prices will rise, and such situation has already appeared. High street grocery Poundland announced that the shop would sell some products which would cost more than one pound on October 2016.
“The daily spending on food was about 100 pounds per month in 2012, if you cook by yourself, only including meat and vegetable, not contain soft drinks, wine and expensive fruit, such as cherry, when I lived in Cardiff,” Louis Li says, whereas the living expense estimates roughly doubled to 200 pounds for international students.
Compared with 2012, the bus price (single trip per person) has increased slightly. “The bus fare was 1.5 pound individually for single trip,” Louis says, now it is 1.8 pound per adult. It is predicted that the traffic fee may rise, as a consequence of the upward trend of petrol price. The reason is that petrol in the UK is mainly imported from other countries, which is priced in US dollar. The statistics released by the RAC motoring organization shows that the average price of petrol rose 4.39p per litre to 116.73p during October 2016. The weak pound makes the petrol price more expensive, thereby may affect public transport companies adjust fare.
However, the weakness of sterling may increase international students’ budget, the majority of students express that the UK is still their preferred choice for pursuing advanced studies. “I plan to pursue my postgraduate in finance and now I am preparing actively for application, the UK is my top five choices since its education system enjoyed great reputation over the world,” says Binwei Wu, a year three student from China.
“The UK is always a popular country for attracting international students to continue their advanced study, especially for Chinese, because most of its universities ranked high, which will benefit for graduates to find a desirable job,” says Lily Liu, a Chinese education agent. She also indicated that the number of application has not affected by the rise of expenses, and the market is still competitive, “Some British universities request to rise the tuition when the news released that the pound fell, we worried about that some students may change their mind at first, but it shows that the market has not been affected and the universities do not lower their applying requirement.”
Additionally, British universities are attractive for Asian students “because some postgraduate programs just take a year, on the contrary, other countries like Australia and America, students have to spend at least one and a half years, which technically could help to save a great sum of money,” Lilly adds.
The other advantage for British universities remain competitive in abroad study market is that its acceptable application fee and some of them are free, in which students could draw on the experience of other seniors and DIY their application plan. If applicants who are willing to apply through agency, for example in China, they could choose five universities based on agents’ suggestion at maximum, while the application fee is more expensive if those who would like to apply to the US universities.
“The application fee is separated into classes according to ranking, for example, if you want to apply to universities ranked from 50 too 200, the application fee is about 20,000 CNY (2,500 pounds),” says Betty Jiang, a Chinese student studied in Florida State University.