By Julie Gordon
OTTAWA (Reuters) – Canadian universities are facing a financial crunch amid the COVID-19 crisis, as a drop in foreign enrollment and shuttered campuses dent the bottom line and the country’s slow vaccine rollout weighs on the next school year.
Public universities have become increasingly dependent on foreign students, who pay far higher tuition than domestic students, to boost their profits. International enrollment jumped 45% over the last five years, advocacy group Universities Canada said, but it fell 2.1% this year amid coronavirus restrictions.
International students at Canadian universities https://graphics.reuters.com/CANADA-EDUCATION/STUDENTS/xlbvgdorqpq/chart.png
That decline, coupled with a sharp fall in revenues from campus services like conferences, dorms, food halls and parking, has hit the schools hard. Canada‘s slow vaccine campaign – it currently lags well behind global peers on inoculations – and the emergence of new variants, could extend the slump in enrollment and campus revenues into the next year school, experts warn.
“Overall, we are expecting universities to post consolidated deficits this year,” said Michael Yake, a senior analyst with rating agency Moody’s.
It is still too soon to know the final impact of COVID-19 on the current year. The University of British Columbia, for example, is projecting a deficit of C$225 million ($177.2 million) this year compared with a C$60 million surplus budgeted pre-COVID-19. And the uncertainty will continue.
“We’re not assuming the vaccine is going to be in place for the fall,” Yake added. “Even if in Canada the vaccines are available, that doesn’t means it’s going to be available for the international students.”
While most of Canada‘s universities are well positioned to weather the COVID-19 storm, an unexpected move by Laurentian University in Ontario to file for creditor protection this month has sparked concerns. Experts says that while Laurentian’s situation is unique, other schools also face cost pressures and some may be too reliant on foreign tuition.
International students brought in almost C$4 billion in annual revenue for Canadian universities in 2017/18, the most recent data from Statistics Canada showed. On average, they pay five times the tuition of domestic students and account for nearly 40% of all tuition fees.
Tuition at Canada‘s Top 5 universities https://graphics.reuters.com/CANADA-EDUCATION/TUITION/jbyvrdrewve/chart.png
At Canada‘s top three ranked universities, foreign students make up at least a quarter of the student body. Many stay in Canada after graduation and contribute to economic growth.
Canada did stave off a feared enrollment plunge this year, in part because the federal government made it easier for international students to get work permits after graduation, but the huge gains in foreign students of the previous five years are likely over.
Indeed a trend that saw many international students choose Canada over the United States in recent years could reverse as U.S. President Joe Biden’s administration overhauls the U.S. immigration.
“Something that’s benefited Canada for some time is the political environment in the U.S., as it drove more international students to Canada,” said Travis Shaw, a senior analyst at rating agency DBRS Morningstar.
The change of administration “probably means we’ve got more competition for those international students in the years ahead,” he said.
An increase in domestic students could offset some of the need for new foreign students, but their lower tuition fees will create a significant financial gap. Other cost-saving alternatives might include reducing course offerings and consolidating smaller schools.
And while international enrollment is expected to stabilize as COVID-19 restrictions are lifted, the longer the pandemic drags on, the greater the risk that more international students will go elsewhere to study, particularly if competitor campuses are able to safely reopen before those in Canada.
“Most students want to come to Canada for the student experience. If a student experience does not seem viable over the term of the course, it is sure to be a deterrent,” said Aditi Joshi, an analyst at DBRS Morningstar.
($1 = 1.2738 Canadian dollars)
(Reporting by Julie Gordon in Ottawa; Editing by Denny Thomas and Aurora Ellis)
Biden on brink of passing historic $1.9tn boost to US economy – Financial Times
Joe Biden is on the brink of securing final approval from Congress for his $1.9tn stimulus bill — a bet that massive fiscal intervention aimed at lower and middle class families will speed up America’s recovery without overheating the economy.
After the US Senate voted to approve the package on Saturday, the Democrat-controlled House of Representatives is poised to give its final green light to the bill on Tuesday, allowing it to be signed into law by Biden.
Barring any last-minute trouble in the House, where Democrats hold a slim majority, the stimulus legislation will mark a big political victory for Biden, who made it his top priority since entering the White House on January 20.
The stimulus bill — known as the American Rescue Plan — represents one of the largest US government interventions in the economy of the post-world war two era — just short of the size of the $2.2tn March 2020 pandemic stimulus, but larger than the $787bn recovery plan during the 2009 financial crisis.
The prospects for its passage have already led many private-sector economists to upgrade their forecasts for US growth this year. Federal Reserve officials are likely to do the same when they publish their latest economic projections next week.
But the plan has attracted criticism from Republican lawmakers — who have so far unanimously opposed the plan — as well as some economists, including Lawrence Summers, the treasury secretary under Bill Clinton — who say it risks a harmful spike in inflation.
A recent sell-off in long-term government debt — with yields on 10-year Treasury bonds rising above 1.5 per cent for the first time in more than a year — has fuelled those concerns, though senior US policymakers including Janet Yellen, the treasury secretary, and Jay Powell, the Federal Reserve chair, have dismissed the worries.
Around the world, the US stimulus package could give a fresh jolt to the global recovery amid hopes that widespread vaccinations throughout the year will help reopen many economies. But any unintended jump in US inflation or debt yields could unsettle markets and prove particularly harmful for emerging markets.
Domestically, Biden’s top aides and many Democrats on Sunday touted the plan as “historic and transformational” legislation for families that have struggled through the pandemic. The bill — which will be financed entirely by adding to the US deficit — will dispatch $1,400 means-tested payments to most Americans; extend emergency federal jobless benefits worth $300 per week until September; increase a tax credit for children; provide aid to states and local governments; and boost funding for schools and vaccinations.
“This is a bill that reflects President Biden’s belief that the best way to get the economy back on track and get it growing is to invest in working people and middle class people,” Kate Bedingfield, the White House communications director, told CNN. “It is urgent aid that is going to help people all across the country but it’s also making a long-term investment,” she added.
The US president had applauded passage of the Senate’s version in remarks on Saturday, following an all-night session in the upper chamber of Congress.
Biden was on Sunday expected to sign an executive order to boost voting rights, at an event commemorating the civil rights protesters who were tear-gassed and beaten by state troopers in Selma Alabama 56 years ago.
Senate passage of the stimulus legislation — by a party-line 50 to 49 vote — was held up for hours as Democratic leaders sought to get the decisive consent of Joe Manchin, the moderate West Virginia Democrat, who was insisting on tighter terms for the jobless benefits.
On Sunday, Manchin did the rounds of US television networks to trumpet his role in the talks, rejecting any fears that the Biden plan was excessive.
“I can assure you, we have helped every segment of society right now, more so than ever before with this piece of targeted legislation,” he told Fox News Sunday.
The global economy won't recover if we don't get vaccines to developing countries, too – CNN
First, step up efforts to end the health crisis
Second, step up the fight against the economic crisis
Third, step up support to vulnerable countries
With many vaccinated, Israel reopens economy before election – NEWS 1130 – News 1130
JERUSALEM — Israel reopened most of its economy Sunday as part of its final phase of lifting coronavirus lockdown restrictions, some of them in place since September.
The easing of restrictions comes after months of government-imposed shutdowns and less than three weeks before the country’s fourth parliamentary elections in two years. Israel, a world leader in vaccinations per capita, has surged forward with immunizing nearly 40% of its population in just over two months.
Bars and restaurants, event halls, sporting events, hotels and all primary and secondary schools that had been closed to the public for months could reopen with some restrictions in place on the number of people in attendance, and with certain places open to the vaccinated only.
Israeli Prime Minister Benjamin Netanyahu’s government approved the easing of limitations Saturday night, including the reopening of the main international airport to a limited number of incoming passengers each day.
Netanyahu is campaigning for reelection as Israel’s coronavirus vaccine champion at the same time that he is on trial for corruption.
Israel has sped ahead with its immunization campaign. Over 52% of its population of 9.3 million has received one dose and almost 40% two doses of the Pfizer vaccine, one of the highest rates per capita in the world. After striking a deal to obtain large quantities of Pfizer/BioNTech vaccines in exchange for medical data, Israel has distributed over 8.6 million doses since launching its vaccination campaign in late December.
While vaccination rates continue to steadily rise and the number of serious cases of COVID-19, the illness caused by the virus, drops, Israel’s unemployment rate remains high. As of January, 18.4% of the workforce was out of work because of the pandemic, according to Israel’s Central Bureau of Statistics.
At the same time that it has deployed vaccines to its own citizens, Israel has provided few vaccines for Palestinians in the West Bank and Gaza Strip, a move that has underscored global disparities. It has faced criticism for not sharing significant quantities of its vaccine stockpiles with the Palestinians. On Friday, Israel postponed plans to vaccinate Palestinians who work inside the country and its West Bank settlements until further notice.
Israeli officials have said that its priority is vaccinating its own population first, while the Palestinian Authority has said it would fend for itself in obtaining vaccines from the WHO-led partnership with humanitarian organizations known as COVAX.
Israel has confirmed at least 800,000 cases of COVID-19 since the start of the pandemic and 5,861 deaths, according to the Health Ministry.
Ilan Ben Zion, The Associated Press
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