Next target: China's $7 billion revenge on Australia

Chinese students make up nearly one third of Australia's $35 billion international student market. Photo / Getty Images

As relations between Canberra and Beijing plunge to new lows, Australian universities could lose billions of dollars in revenue if China decides to take aim at the country's third biggest export.

China has introduced a string of punishing economic sanctions on Australian trade goods in recent months, including a 200 per cent tariff on wine, but has so far not taken any action to disrupt the education sector.

Chinese students make up nearly one third of Australia's $35 billion international student market. Last year, Australian universities reaped more than $7 billion in fees from around 164,000 Chinese students, who contributed a total of $12.2 billion to the economy including accommodation and other living expenses.

With COVID-19 travel bans still in place, some 62,000 Chinese students are currently studying online from overseas. But if Chinese students don't return once the borders reopen, Australian universities face a devastating financial impact.

For the Chinese Communist Party – which has stepped up its attacks on Australia, culminating this week with a senior diplomat sharing a sick doctored image of an Australian soldier – it would be as simple as cutting off online access through its internet firewall, and barring its students from travelling to Australia.

"I think it's almost inevitable at this point that China will take action against the higher education sector, given the way China has already inserted itself into our universities," said University of Queensland student Drew Pavlou.

"(But) it's probably difficult to imagine them simply turning off the tap, given how important these universities are to the Chinese elite as a way to have their children get these prestigious credentials."

Mr Pavlou was expelled for alleged misconduct linked to his on-campus activism supporting Hong Kong and criticising the CCP, and was part of a July 2019 protest which turned violent when "ultranationalist Chinese students" gatecrashed and began assaulting attendees.

Since then he has campaigned to have the federal government investigate foreign interference at the university, and took the Chinese Consul General to court for allegedly inciting violence against him. The Brisbane Magistrates Court dismissed the complaint due to diplomatic immunity.

An exodus of Chinese university students would hurt the education sector in Australia. Photo / Getty Images

The state-run Global Times has published a series of articles this year suggesting Chinese students should reconsider studying at "racist" Australian universities – citing Mr Pavlou as an example – and in June China's Ministry of Culture and Tourism issued a travel alert for "racist risks" in Australia.

Louisa Bochner from the Australian Strategic Policy Institute agreed it was unlikely that China would take immediate action against Australian universities given their importance to its middle-class. "The higher education sector is different to our other major exports in Australia," she said.

"For example, with wine or barley, the net effect on Chinese middle-class consumers is small – it's unlikely there will be much furore or difficulty in swapping to a different product. For higher education, however, it's more complicated."

She said there were fewer alternatives, and tensions with the US, Canada and the UK meant China would not be that interested in diverting its students to those countries. "Australia has top-tier, affordable education, which Chinese students need," she said.

For now, the university sector is optimistic.

International Education Association of Australia chief executive Phil Honeywood said there had not been any sign of an official policy from the Chinese government targeting the Australian education sector.

"We haven't seen any evidence so far that the Chinese government are taking any positive steps to stop their citizens from studying with Australian education providers," he said. "There was earlier this year a travel advisory put out in terms of safety of travel to Australia, but they put that out for a number of countries, and it wasn't a directive (not to travel)."

Mr Honeywood said the IEAA was "confident that to date the people-to-people and institution-to-institution relationships are still supporting international student enrolments".

He noted that a plane of returning international students touched down in the Northern Territory this week, and among the 63 were "a good number" of students from mainland China heading to Charles Darwin University.

And on Thursday, Mr Honeywood spoke to the principal of Melbourne international private school Haileybury, which maintains a campus in China. "They've had a 25 per cent increase in their Chinese student enrolment," he said.

According to Ms Bochner, even if the CCP did decide to use the higher education sector as a "vector for retaliation", it was not clear how it would be done.

"It's not as clear as 'turning off the taps' as with other exports – would they send home the students who, just last week, arrived back in Australia?" she said. "Or would they prevent new enrolments from next year? My opinion by and large is that we're unlikely to see any sort of immediate retaliation."

Mr Pavlou, however, said it was possible the CCP may leverage its position by seeking to more forcefully exert its influence on campuses – knowing the universities are powerless to act.

"You see with the Chinese student associations, they boast of their links to the Chinese consulate – they're basically run as an extension of the consulate," Mr Pavlou said. "The case at UQ where you had a rally that became violent and there were attacks against critics of China, that could definitely be a further possibility."

He highlighted the recent controversy after UNSW deleted an interview with Human Rights Watch Australia director Elaine Pearson about Hong Kong, following backlash from some in the Chinese student community.

"The universities clearly don't know how to deal with this problem," he said.

"It's going to be interesting to see whether Australian universities have learned from my case how destructive it appears to be kowtowing to Beijing – or if the economic imperative means they are willing to weather harsh criticism domestically to keep ties to Beijing strong."

- News.com.au