West Loop Ventures partner applauds university insuring against loss of Chinese students
Jeff Carter really doesn’t see many losers in schools such as the University of Illinois Urbana-Champaign looking to protect their rapidly growing international student base.
“U of I has a lot of Chinese students, and it’s smart of them to be looking for ways of protecting that revenue stream,” Carter, a general partner of Chicago-based B2B Fin Tech investment company West Loop Ventures and a graduate of the school, told the Prairie State Wire.
“With China being a Communist nation, they (university officials) have to always be mindful of all the extraneous circumstances that can change things in an instant, such as the Chinese government no longer wanting to allow its students to attend schools in the U.S.," he added. "I think it's borderline brilliant, the posture they’ve taken to protect themselves.”
School officials recently took out an insurance policy in the neighborhood of $425,000 annually to guard against any steep or sudden drops in enrollment of Chinese students in the school’s colleges of business and engineering.
According to MarketWatch, the plan provides up to $60 million in total coverage, with College of Business Dean Jeffrey Brown explaining benefits are set to kick in if the schools are faced with at least an 18.5 percent dip in enrollment of Chinese students compared to the year before that stems from any “political event, like a visa restriction, or some kind of health scare.”
Carter said the pushback school officials are facing stemming from claims area students are being locked out of any chance of attending one of the state’s largest schools is nothing new.
“Years ago, Illinois tried to admit a more diverse student population, and legislatures had a lot to say about it,” he said. "It’s a hard problem for Illinois, but for those local students who are admitted, just think of the network they stand to have from some of the international contacts they might be able to make. That can be good for them and good for the state at the same time.”
The number of foreign students on U.S. campuses has been on the rise ever since state governments began reducing funding for public colleges.
In 2017, when U of I officials entered into the insurance arrangement, Chinese students accounted for roughly 20 percent of the College of Business’s total revenue. In addition, the Institute for International Education reports that during the last academic year the number of Chinese students studying in the U.S. overall grew by nearly 4 percent.
“I don’t think the fact that you admit more Chinese students changes a whole lot,” Carter added. “The fact of the matter is Illinois is a very selective school when it comes to who gets in. The whole class of engineering students gets 36 on their ACTs and are at the head of their class. It comes down to tradeoffs, and if you’re not a top-flight student you’re not getting in anyway.”