Economic Impact of Saudi Arabian Students in Atlantic Canada (Part 2)

Editor’s note: what follows is the second in a series of posts about Saudi Arabian students in Atlantic Canada. See the first piece in the series here.

By Azad Haider, Post-Doctoral Fellow, Saint Mary’s University, and Jackson Doughart, AIMS Policy Analyst

Part I of this series looked at the growth in the population of Saudi Arabian students at Canadian universities, with a particular focus on Atlantic Canada. As we saw, the number of students from Saudi Arabia has increased across the region since the turn of the century, and is of particular note in New Brunswick and Nova Scotia.

As reported by CBC News last year, the Saudi Arabian scholarship program will soon end for those universities who are not found in the Top 200 world universities, according to the Shanghai Top 300 World Index. According the CBC piece, Saudi Arabia wants to extend scholarships to only those schools where “the quality of education is much better.” Unfortunately for the Atlantic region, none of its universities fall in the top 200.

Peter Halpin, the Executive Director of the Association of Atlantic Universities, said “the King Abdullah Scholarship is being ‘reshaped’ and will only support students at the world’s 200 best universities.” He further added that “this program has had a real, significant, positive effect on the recruitment of Saudi students to the Maritimes.”

It is important to look at the economic impact of Saudi students on the region’s economy, as the diversion of these students to other schools could have a substantial local effect.

International students contribute approximately $565-million annually to the regional economy, and Saudi Arabian students are 12.03 percent of the total international students enrolled in the Atlantic Canada. Table 1 below provides the contributions of Saudi students in particular.

Table 1: Economic Impact of Saudi Students in Atlantic Provinces

Province Number of students 2013/2014 Saudi students percent of total international students in region Economic impact (portion of 565 million) Economic impact in million (Siddiq et al.)
Newfoundland and Labrador 48 0.35 2.00 2.05
Prince Edward Island 21 0.15 0.87 0.90
Nova Scotia 1167 8.60 48.61 49.89
New Brunswick 396 2.92 16.50 16.93
Total Saudi Students in Atlantic Canada (AC) 1632 12.03 67.98 69.77
Total in Atlantic Canada 13563 100.00 565
Source: Postsecondary Student Information System (PSIS) Survey 2013/2014

According to Table 1, the total economic impact of Saudi Arabian students in Atlantic Canada is $67.98 million, with the largest portion ($48.61 million) captured by Nova Scotia. Siddiq et al. (2009) estimate that international students spend on average $28,500 per year in Nova Scotia and assumed this amount for the whole Atlantic region. Spending is even higher when one accounts for economic multiplier effects.[1] We also did a pilot survey for Saudi students and calculated that average spending is approximately $30,000 per year in Halifax[2]. Furthermore, the study found that students spend $3.40 for every $1 the province spends on their healthcare and education.

We calculate the economic impact of Saudi students in Atlantic Canada in last column of above Table 1, according to the metrics of Siddiq et al. (2009). According to these estimates, Saudi Arabian students make a $69 million contribution to the Atlantic Canadian economy, especially in Nova Scotia. The Siddiq et al. estimate mirrors closely our estimates in column 3, which are simply the total figure apportioned by number of students per province. These estimated figures would be higher if we calculated recent data with inflation adjusted, as these above estimates are calculated to 2008-09.

In sum, the Saudi government’s decision to stop these scholarships for Atlantic universities poses a huge potential loss for the universities as well for the Atlantic regional economy. One can expect that this loss will be shifted to Canadian students in coming years, perhaps through such measures as higher tuition.

In the next post, we will look at Atlantic University Rankings on the Shanghai Index.

 

[1] Siddiq, Fazley, Brandon Holterman, Warren Nethercote, Alasdair Sinclair, and Allan White. The Economic Impact of International Students Enrolled in Nova Scotia Universities: An Expenditure Analysis. Halifax, NS: Department of Education, Province of Nova Scotia, December 2009. http://www.gov.ns.ca/lae/ highereducation/documents/international_students_final_report.pdf.

[2] Internal Data collected by AIMS.

 

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