Exploring the Benefits and Challenges of Achieving 250,000 International Students in Malaysia

1.0 Abstract

With a target enrollment of 250,000 students, the influx of international students has become the centre of attention for Malaysia's educational landscape. The mechanisms and tactics needed to meet and potentially surpass this high standard will be examined in this study. This study aims to review how Malaysia can utilise the significant number of international students as a valuable resource for the nation's socio-economic advancement by examining some possible benefits and difficulties presented by their presence.

2.0 Introduction

2.1 Malaysia’s Ambitious Goals: A pipedream or a could-be reality?

In 2015, the Malaysian Ministry of Education (MOE) laid down an ambitious goal whereby Malaysia aims to attract up to 250,000 international students to Malaysian HLIs (Higher Learning Institutions) in a decade (Kementerian Pendidikan Malaysia,2015). Such a goal, even by today's standard are considered somewhat monumental. The number of international students in Malaysian tertiary institutions stood at 135,502 (Sundarrajh and Zulkfili, 2019) in 2015. With up to 250,000 international students, not only will Malaysia become the world's 8th largest international study destination, but it will also become among the most popular international study destinations in Asia (Project Atlas, 2022). As of 2022, three years before the dateline of the goals set by MOE (now under MOHE (Ministry of Higher Education), Malaysia’s international students stand at 139,528 (around 55% of its goals). China, the largest country of origin for international students in the world, consists of 37.3% of total international students in Malaysia, with Indonesia and Bangladesh in a distanced second (10.7%) and third (6.0%)(Ministry of Higher Education,2023). With less than three years remaining, can Malaysia drive international student numbers to new heights?

2.2 Soaring High: Malaysia’s Advantages

Traditionally, Malaysia has a few advantages over its competitive peers—first, the low cost of combined education and living costs in Malaysia. Malaysia’s capital city, Kuala Lumpur sits in the bottom 20% of living costs in all cities globally, whereas in comparison, nearly all traditionally recognised global education hubs like Boston, London, New York, and Sydney sit firmly in the top 50 most expensive cities in the world (Numbeo,2023). Malaysia's higher institutions also performed relatively well in world rankings in recent years, with Universiti Malaya currently in the Top 100 university leagues. While other research universities like USM, UKM, UPM, and UTM are conferred as top 150 universities worldwide (QS,2023). Malaysia is also a relatively safe and peaceful country in Asia, as Malaysia ranked among the top 20 most peaceful countries worldwide, according to the Global Peace Index 2023(Institute for Economics &Peace,2023). Geopolitical stability and safety remain a primary concern among international students.

2.3 To Woo the Dragon: The Special Case of China

In recent years, Malaysia has garnered success in attracting students from the world's largest country of origin of international students, China. Malaysia concurrently hosts more than 38,000 Chinese students in various higher education entities. The figure is indeed quite impressive as it surpassed the number of Chinese students in Germany, France and New Zealand(UNESCO Institute of Statistics, 2023), enabling Malaysia to become 7th in the top destination country for studying abroad among Chinese students.

Some Chinese students seek an alternative to the Gaokao (Nationwide Unified Examination for Admissions to General Universities and Colleges). Gaokao is one of the world's ‘toughest and largest exams’, with nearly 13 million candidates in the 2023 season(CNN,2023). The increase in competitiveness, known as ‘involution’ in Chinese terms, forced millions of Chinese parents to pursue international education. Furthermore, China’s recent economic slowdown further exaggerated this situation, whereby companies and even government agencies have become more stringent in hiring job candidates, with some requiring a degree or even a postgraduate degree from a Project 985/ Project 211 elite university in China. Therefore, Chinese students with the financial means had turned to foreign institutions as entry for foreign institutions seemed less competitive, yet enabled them to compete with a degree from a 985/211 institution.

With a weakening Renminbi, some middle-class Chinese parents, who do not possess the financial means to send their children to traditional study destinations such as the US, the UK, and Australia may opt to further their children’s education in Malaysia as it is significantly cheaper to study in Malaysia (Malay Mail,2023) before sending their children to the US, UK and Australia for postgraduate studies. Malaysia is also merely a few hours from most cities in Mainland China, with air routes connecting primary and secondary cities in China, so it is close to home for many Chinese students.

Besides, Malaysia's stable diplomatic relations with China also further encourage Chinese students to study in Malaysia. Chinese students value such stability as there have been instances whereby the turbulent relations between China and the West had affected Chinese students studying abroad in the West in prior cases. For instance, in 2020, Donald Trump issued Proclamation 10043, which prohibits some Chinese students from getting a study visa to study in America (Federal Register, 2020). Finally, Malaysia's large Mandarin-speaking, culturally competent Malaysian Chinese community increases Malaysia's advantage in attracting Chinese students. The reduction of cultural barriers in terms of food and entertainment and the presence of a Sinophone community helps Chinese students adapt to life in Malaysia sooner.

2.4 Malaysia's Emergence as an Educational Hub: The Allure for Middle Eastern Students

Malaysia’s relatively conservative, Islamic society and moderate geopolitics stance also boost its attractiveness among Muslim nations. Students from countries such as Iran find it increasingly difficult to study in the West. As such, Malaysia's Higher Education benefited from the influx of students from Middle Eastern countries(Graf. A., 2016).

A study by Mazen Rohmi (2010), states that Arab families encourage their sons to travel and study in Muslim nations where mosques, Halal food, Islamic Teaching and Islamic rituals exist.

The studies also show that Arabs prefer Malaysia due to its status of being safe and stable, with a great educational environment in its academic institutions. Such positive, crucial attributes are sometimes lacking in Arabian societies and academic institutions.

Interestingly, the study also shows that costs also play a role in the attraction of Arabic students, however, such cost attributes also cause the reduction of attractiveness of Malaysia toward wealthier Arab Nations or the Gulf Cooperation Council members that regarded Malaysia as a ‘cheap’ country. As a result, there are only limited students originating from GCC countries.

2.5 Challenges and Opportunities in Malaysia's Quest to Become a Global Education Hub: A Focus on Attracting International Students

The benefits of attracting international students to Malaysia are multifaceted. For one, they have the potential to contribute significantly to the skilled migrant labour force, particularly in STEM fields, to address labour gaps. In Canada, as of 2018, the number of post-grad work visa holders has grown more than 13 times in size, from 10,300 in 2008 to 135,100 in 2018 (Crossman, Lu and Hou, 2022). A lot of them were employed in the STEM-related industries. To tap into this potential highly skilled workforce, Prime Minister Anwar Ibrahim recently announced the intention to provide post-study work to international students during the tabling of the Malaysia Madani Budget 2024 in Parliament (BERNAMA, 2023).

Financially, international students make substantial contributions through tuition fees, living expenses, and immigration services. These funds support educational institutions, stimulate economic sectors such as accommodation, food, transport, and entertainment, and enhance trade opportunities.

However, Malaysia faces challenges in achieving its goal, notably in global competitiveness. The limited recognition of its educational institutions compared to established destinations like the US, UK, and Australia poses a hurdle. This stems from insufficient investment in research and development, complex visa application processes, and potential cultural adaptation issues in its multicultural environment.

As such, this essay intends to have a deeper discussion of these issues and unveil solutions to such problems.

3.0 Literature Review

The pursuit of becoming a prominent global education hub is a shared aspiration among many nations, and Malaysia is no exception. This literature review aims to discuss the ambitious goal of attracting international students to Malaysia and the challenges faced by international students in Malaysia. International student mobility has been recognized as a transformative force in the realm of higher education, not only economically but also culturally, socially, and academically.

In recent decades, Malaysia has emerged as an increasingly appealing choice for global students. In 2010, Malaysia hosted 70,000 overseas students, a significant rise from the 30,000 in 2003 (Mahmud et al., 2010). Most of these students hailed from Southeast Asia, the Middle East, Africa, and Middle Asia, with only a small fraction coming from Europe. This substantial increase suggests a growing trend of international students choosing Malaysia as their educational destination. The country's commitment to educational excellence, presence of globally recognized universities, and rich cultural diversity have all contributed to this shift. Moreover, the Malaysia Education Blueprint of 2015 specifically emphasized the importance of international student enrollment, further fueling this momentum (Rajaendram, 2023).

Attracting international students to Malaysia has been a concerted effort, with several initiatives in place to facilitate their educational journey and overall experience. There are a few issues that arise when attracting international students - obtaining a visa, having trouble establishing a bank account, opportunity to work part-time to pay for their education, and securing work after graduation (Rajaendram, 2023). The most critical factor in enticing students from around the world is the relatively straightforward process of securing a student visa. "A student visa in Malaysia is more challenging to obtain than in Australia or the United Kingdom, which makes Malaysia an unappealing destination for parents looking to send their children abroad, even though it is cheaper to study here," Prof Mushtak Al-Atabi argued at the VCCPU (Vice Chancellors Council for Private Universities) and Education Malaysia Global Services (EMGS). The awareness of more emerging nations working hard to be education hubs in their rights is needed. Based on UCSI Group Strategic Office vice-president Sheikh Fahmy Sheikh Mohamed, nations that are broadening their educational programme include Saudi Arabia, the United Arab Emirates (UAE), Vietnam, Indonesia, India, and Saudi Arabia. These countries are home to various overseas branch campuses of prominent universities. Such enhancement in other countries’ educational sectors with the complicated and long duration of visa application in Malaysia may hinder Malaysia from attracting more international students.

At this point, there are unclear regulations governing international students' eligibility for post-study work visas after they graduate from Malaysian university. Dr Teh Choon Jin, National Association of Private Educational Institutions (Napei) secretary-general (Rajaendram, 2023) proposed that "Post-study work visas for international students should be granted for two years, following which employers may choose to continue hiring these graduates under work visas. "There are two years of post-study visa opportunities available in the UK and Australia. International students are granted Australian post-study work visas automatically. "This will strengthen Malaysia's appeal as a study destination for students from developing nations, where the majority of international students come from and where that number is rapidly increasing.”

Mahmud et al.(2010) reported that obstacles endured by international students studying in Malaysia encompass accommodations, local language, cuisine, weather, and financial arrangements. Since most Malaysian universities use English as the medium of instruction, it is crucial for international students to have the ability to speak and understand English. They asserted that limited English language competency restricts international students from engaging actively in class and makes it more difficult for them to acclimatise to the various dialects and slang used by local teachers. International students may engage with locals more effectively and have a greater comprehension of local culture through the acquisition of the language. Speaking the language fluently facilitates socialisation, communication with teachers and staff at the institution, and adaptation to new surroundings for overseas students.

Conversely, refraining from social interactions with locals might result in misunderstandings and cultural adjustment, both of which may jeopardise social support (Chen, 1999). International students, especially those who undergo cross-cultural transition, may struggle to adapt to their new surroundings and develop psychological symptoms such as anxiety, bewilderment, homesickness, loneliness, loss of identity, inability to concentrate, and low self-esteem (Bethel et al., 2020).

In short, the aforementioned literature reveals several studies conducted to attract international students into Malaysia's education hub and also the obstacles faced by international students when enrolling. However, those articles briefly suggest how the presence of international students can bring advantages to Malaysia and the real side of difficulties when entering a fresh new education hub. Therefore, the following paragraphs will discuss these in depth.

4.0 Analysis

4.1 Benefits that international students can bring to Malaysia: based on global evidence.

The Malaysian government endeavours to bolster the influx of international students, motivated not only by their historical benefits for Malaysia but also by recognizing the advantages witnessed in other popular study destinations. As of 2019, international students have played a vital role in contributing approximately RM5.9 billion annually to the Malaysian economy, highlighting a significant financial impact (Idris, 2017). Beyond this, international students serve as crucial contributors to the development of their study destination countries, facilitating labour migration and stimulating financial revenue. This section will provide real-life examples from various nations to illustrate these multifaceted contributions and discuss how Malaysia can use these advantages for itself.

4.1.1 Migrant labour

International students have a positive influence on the migrant labour force, acting as catalysts for wage increases among migrant workers and enticing them through expanded trade to mitigate labour gaps in Malaysia. The increase in migrant workers' wages is linked to the specialised skills acquired by international students. Figure 1, portraying the countries favoured by international students in 2022, reveals that 54% of those in the US pursue science, technology, engineering, and mathematics (STEM) programs, with Australia and the UK similarly boasting significant percentages of 42% and 36%, respectively, opting for STEM courses. This trend underscores international students' inclination towards sectors where specialised skills are honed, typically high-income fields. Consequently, if they opt to work in their educational host country post-graduation, it enhances the average wage of migrant workers, presenting an appealing prospect for other highly skilled foreign workers who are willing to work in the country. Moreover, research suggests that international student migration can elevate wages for migrants without detrimentally affecting native workers (Chevalier, 2014). As of 2023, only approximately 25% of Malaysia's total workforce comprises highly skilled workers (Bong, 2023). An increase in the number of international students in Malaysia, given their propensity for highly skilled majors, could enhance the likelihood of retaining these skilled individuals. Meanwhile, the average salary increase for migrant workers also attracts other countries’ people to work in Malaysia, thereby mitigating the shortage of highly skilled workers in Malaysia. Regarding trade expansion, this phenomenon is predominantly caused by the extensive networks that international students bring. Hailing from diverse national backgrounds, their presence establishes connections between their home countries and their study nations. If international students opt to stay in the host country post-graduation, these global networks become invaluable channels for trade opportunities and partnerships, benefiting both the study countries and their countries of origin. A research from the School of Economics at the University of Dublin indicates that for every 10% increase in the total number of immigrants, exports from the host country to their original country increase by 2.6% (Anderson, 2022). Additionally, a report highlights that Malaysia faces a shortage of at least 1.2 million workers in 2022 in manufacturing, plantations, and construction, a deficit worsening with growing demand (Lee, Latiff and Chu, 2022). The trade-expanding effect of international students presents an opportunity to attract more foreign labour, thereby assisting Malaysia in filling this labour gap.

Figure 1

Source: (Statista, 2023)

4.1.2 Financial contribution

International students play a crucial role in making a substantial financial contribution to the countries where they study, primarily through three main sources: tuition fees, living expenses, and immigration services expenses. Concerning tuition fees, international students typically pay higher amounts compared to their domestic students. This financial input significantly contributes to increased revenue and overall economic stability. The funds generated from tuition fees are instrumental in supporting educational institutions, enabling improvements in facilities, and facilitating the organisation of a greater number of seminars. Notably, in 2019, the tuition fees of international students contributed a staggering $38.7 billion to the US economy, underscoring the significance of this financial stream. Another substantial source of financial contribution from international students to the economy is their living expenses(Dickler, 2020). These encompass accommodation, food, transport, and leisure activities. The rental of flats or dormitories by international students leads to an increased demand for accommodation, thereby stimulating the property market. This heightened demand has a ripple effect, potentially driving construction and property development, resulting in the creation of new accommodation options and the expansion of existing ones. Consequently, this dynamic process generates employment opportunities within these sectors. The demand for food by international students also has a noteworthy impact on the food industry, from local markets specialising in native cuisine to restaurants offering international fare. This not only contributes significantly to the income of these businesses but also indirectly supports agriculture and food production. It ensures a steady demand for food products, thereby stimulating the economic and financial development of the host country. Moreover, international students make considerable financial contributions to the transport and entertainment sectors. Their expenditures in public transport, car rental, and taxi services result in increased revenues in the transportation sector. This financial input also supports the development of transport infrastructure, creating more job opportunities within this sector. Additionally, international students actively engage in entertainment activities such as visits to theatres, cinemas, museums, and sporting events during their breaks. This not only boosts earnings in the entertainment and leisure sector but also contributes to sustaining these industries. The tourism sector also benefits significantly from the spending of international students. In the United States alone, international students contributed approximately $28.4 billion to the economy during the 2020-2021 academic year through expenditures on housing, transport, dining, and consumer goods (Hubbard, 2022). Furthermore, international students contribute to immigration service revenues through various channels. They pay fees for visa applications, renewals, and extensions, and these fees can be substantial, varying based on the type of visa and host country regulations. This notable source of revenue enhances immigration-related financial streams. Additionally, the cost of visas for international students travelling with their families further augments revenue, as the issuance of visas for family members and friends coming to visit international students also contributes to the revenue stream. In certain unforeseen circumstances, international students may face fines for offences such as overstaying their visas or working without proper authorization, which will further bolster revenue from immigration services. In conclusion, the financial impact of international students is multifaceted, extending across tuition, living expenses, and immigration services, and plays a pivotal role in the economic and financial development of host countries. Based on a report in 2019, The average expenditure of a foreign student in Malaysia is about RM46,000 per annum (Bernama, 2019). So if more and more foreign students come to Malaysia, it will make Malaysia generate more financial revenue.

4.2 Challenges of Malaysia to Achieve the Goals

As Malaysia strives to reach its goal of hosting 250,000 international students, the task appears challenging, as evident from the graph depicting a decline in international student numbers between 2018 and 2020. In 2018, the count dropped to 81,953, marking a decrease of 18,812 from the 100,765 recorded in 2017. Subsequently, the figures for 2019 and 2020 remained below 100,000, standing at 89,193 and 92,519, respectively. This trend raises concerns about Malaysia's ability to achieve its ambitious target in the foreseeable future. Although the stagnation in numbers can be partially attributed to disruptions caused by the COVID-19 pandemic, Malaysia faces substantial challenges, primarily rooted in global educational competitiveness, visa process and multicultural environment. A significant hurdle is the limited global recognition of Malaysian educational institutions. In contrast to well-established study destinations like the United States, the United Kingdom, or Australia, Malaysia's higher education system lacks the same level of development. The prestigious universities in these countries boast decades or even centuries of recognition, renowned academic reputations, and globally valued degrees. For example, institutions such as Harvard University and the University of Oxford consistently rank in the top 10 globally (Claybourn, 2022). Conversely, Malaysia's Universiti Malaya is the sole institution making it to the top 100 in the latest QS World University Rankings (Tee, 2023). This suggests that Malaysia may struggle to attract international students due to a lack of global recognition. To enhance global recognition, Malaysia must address the limited investment in research and development, hindering research opportunities and the quality of academic programs. Research facilities and academic research processes play a pivotal role in a student's choice of study destination. Academic powerhouses in North America and Europe offer top-notch research facilities and more systematic academic research processes, providing students with diverse academic experiences. While Malaysian higher education institutions offer high-quality education, they may not provide the same level of research background and innovation, limiting their appeal to students seeking a comprehensive academic environment. Additionally, the visa application process poses a challenge for potential international students considering Malaysia. Despite efforts to simplify the process and attract students, administrative procedures and visa regulations are still perceived as complex. Although visa applications are typically processed within 14 working days (Education Malaysia Global Services, 2023), students are advised to submit applications one to three months in advance to account for unforeseen circumstances. This complexity may discourage students who prefer countries with more straightforward immigration procedures, potentially making Malaysia less attractive as a study destination. Another potential barrier is the cultural aspect. Malaysia's multiculturalism, while celebrated, can pose challenges for international students. Many foreign students may be unaccustomed to the diversity of cultures, religions, and customs. Adapting to a different lifestyle with unfamiliar social norms and customs may be perceived as energy and time-consuming, and some students may fear that cultural differences could lead to a sense of isolation or discomfort. Malaysia's effort to reach its international student target necessitates addressing these challenges, enhancing global recognition, simplifying visa processes, and providing support for cultural adaptation.

Figure 2

Source:(UIS Statistics, 2023)

4.3 Possible Ways to Overcome

To achieve its objective of attracting a greater number of international students, Malaysia must tackle several key challenges through multilateral collaboration. Foremost among these is Malaysia's limited international accreditation compared to global educational powerhouses. While many foreign universities have established campuses in Malaysia to enhance their reputation in Southeast Asia, Malaysia can further draw international students through strategic partnerships with foreign institutions. Examples of successful collaborations include the University of Nottingham Malaysia and Monash University Malaysia. In 2013, international students constituted 36% of the total student population at the University of Nottingham Malaysia (The University of Nottingham Malaysia, n.d.). Another exemplary partnership is Dubai International Academic City (DIAC), established in 2007 in Dubai, United Arab Emirates, which plays a pivotal role in promoting Dubai as a global education hub (Ministry of Economy UAE, 2020). It has become a key destination for higher education and research, enrolling over 24,000 students as of 2017 (UAE free zones, n.d.). Enhancing global accreditation necessitates robust investment in research, including financial resources and scholarships. The Singapore-MIT Alliance for Research and Technology Centre (SMART), a collaboration between MIT in the United States and the National Research Foundation in Singapore, serves as a successful model. Established in 2007, SMART has attracted international students and researchers to Singapore through programs like the SMART Centre Graduate Fellowship Programme (MIT COURSE CATALOG, 2023). Malaysia can emulate this by promoting its research sector globally and attracting international students with exceptional research capabilities. Simplifying the visa process is beneficial, but it becomes less critical when Malaysia maintains a high academic standard. Therefore, the focus should be on creating a compelling academic atmosphere that diminishes the significance of visa procedures in attracting international students. Malaysia's commitment to addressing these challenges will be pivotal in achieving its goal of becoming a preferred destination for international education.

5.0 Conclusion

In conclusion, achieving the goal of 250,000 international students holds numerous advantages for Malaysia, particularly in augmenting revenue and enticing a greater influx of migrant labour. Yet, the realisation of this target is contingent upon elevating Malaysia's standing in international education recognition, enhancing its academic and research profile, and fostering its multicultural environment. To bolster these key aspects, it is imperative for the Malaysian government to proactively engage in multifaceted collaborations. This may include the establishment of overseas campuses in Malaysia by partnering with recognized countries and intensifying academic and research collaborations, as well as hosting forums to cultivate a more appealing educational landscape for prospective international students. By fostering these collaborative efforts, Malaysia will not only achieve its numerical targets for international student enrollment but also position itself as a global centre for education and research, resulting in lasting socio-economic benefits.

Article by Chua Yu Heng, Woo Shinyi and Tu Yizhi.

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