Higher Education in Sub-Saharan Africa
Economics of Higher Education: Loans, Budgets, and Emigration
Cost-sharing. Who can pay for university education besides governments? One option is the students themselves. "Cost-sharing" (fees at public universities, or private university tuition) has been widely promoted and is now being adopted by many African countries. Korea provides precedent for this path, with its university expansion occurring primarily in private institutions. The assumption behind cost-sharing is that university graduates will eventually get higher-paying jobs, and so will earn back the costs they have paid. Unfortunately, students do not yet have that money at the time they enroll. And in all but a few countries (South Africa, Kenya, Tanzania to a lesser extent), there are no programs to loan it to them.
Most students surveyed entered university in the new era of cost-sharing. They report costs for attending university of up to 3.3 times GNI, the equivalent of $140,000/yr in the U.S. With costs so high, only wealthy families can comfortably afford to send their children to college. Nevertheless students from all backgrounds are entering universities in Africa. The students surveyed here do not represent a privileged elite; over 60% had parents who did not attend university. Some received government scholarships and could not have attended otherwise; others describe suffering under financial hardship. The students almost universally cited financial burden as the most common reason why students drop out of or fail to enter university. Requiring high contributions from students is ethical and effective for development only if paired with providing loans or grants to those who need them.
-- see these surveys from Togo and Nigeria for the hardship of high university fees. See this survey from South Africa for the effect a student loan can have: the difference between a life as a domestic servant and one as a research scientist. --
International assistance. Building viable student loan programs is difficult in countries with high and variable inflation, low data-gathering capacity, and high unemployment rates even for college graduates. Default on loans is high, some of it avoidable (students emigrate or simply do not pay) and much unavoidable (students do not have income). Nevertheless many creative mechanisms have been devised for building ethical, compassionate, and yet practical programs. One proposal is that repayment of university costs occurs simply via a higher income tax rate for university graduates. Can international donors help? They can provide advice and assistance in setting up programs, as is done already by the International Comparative Higher Education Finance and Accessibility Project at SUNY-Buffalo (funded by the Ford Foundation) (See also ICHEFA publications). On a larger scale they can provide capital, either directly or by guaranteeing loans to encourage private equity to step in. No donors or agencies have yet attempted this.
Doubling enrollments. How much money is required to expand university education in sub-Saharan Africa to 10% of the population, a reasonable threshold for economic stimulus? Collected data are imperfect, but we can easily make a rough estimate. Sub-Saharan Africa has a population of 740 million (World Bank). Africa's 50 year average lifespan means that roughly 8% of this population is in an age bracket to attend a 4-year university. With a 5% current university enrollment rate, the total number of university attendees can be estimated as: Nstudents = 740 million X .08 X .05 = 3 million students. (In which case African universities produce some 500,000-750,000 graduates per year, depending on dropout rate and timing).
The UNDP estimates the cost of university education in Africa as as $10,000-$15,000 for 4-year degree, i.e. $2500-3750/(student*year). (This is consistent with data from World Bank and student surveys: the World Bank reports mean government spending of $2000/(student*year), and students reported personal contributions of ca. $500/(student*year). ) The total annual cost of tertiary education spending in Africa each year is then $7.5-$11 billion, of which ca. $2 billion is borne by students and their families. We can then conclude that doubling university education in sub-Saharan Africa would require ca. $10 billion/year in additional funding.
Comparison to other expenditures. Total U.S. development assistance to Africa in 2004 was $0.6 billion (Brookings Institution, or see associated table). Debt service by sub-Saharan Africa was $15 billion in 2003 (United Nations). Federal and private student loans taken out by U.S. tertiary students were $68 billion in 2003/4 (College Board).
Concerns. Many researchers have expressed concern about "brain drain" from Africa, the loss of highly educated people. It is important to separate out two effects of this emigration: 1) loss of skilled people who cannot be replaced, and 2) loss of money spent educating people who leave. The strong demand for higher education in Africa means that brain drain is not necessarily damaging in and of itself. In many cases, if sufficient funding existed, more professionals could be trained to take the place of those who leave. In this case the primary harm of emigration is the financial loss.
Irreplaceable losses. In some cases the hemorrhaging of professionals from Africa leaves countries without the means of meeting their own needs or of training replacements. Estimated losses include:
The loss of health care professionals in particular is encouraged by the developed world: National Health Services of European countries mount recruitment drives to attract nurses from Africa, sometimes signing contracts with students before they graduate. (See reports on doctors from West Africa, nurses, all health care professionals, and the health care labor market in general.) To maintain local health services and professional training, governments and donors must work to raise salaries and working conditions in African hospitals and universities.
Costs. In many cases, however, exploding demand for higher education means that emigres are replaceable. In these cases the loss is primarily financial. The International Organization for Migration (IOM) estimates that 100,000 emigrants leave sub-Saharan Africa each year, and that most are highly-educated (ca. 75% have attended university). That is, roughly 10% of all university graduates emigrate. Using the cost numbers above, this represents an educational loss of roughly $1 billion/year. If the greater expense of postgraduate training is taken into account (doctors and other postgraduates are even more likely to emigrate), that cost estimate rises to $1.5 billion/year. If primary and secondary educational spending is included, the estimate rises to $3.5 billion/year. This exceeds the total development assistance sent to Africa. Africa is subsidizing the production of doctors, nurses, and professionals for the developed world. (Notes on dropout rate.)
Tradeoffs. Note that emigration does not represent a pure financial loss to Africa, as emigres remit somewhere between $5-17 billion per year (estimates vary). That money does not however return to Africa's universities. Remittances by a few do not solve the financial crisis of African universities, nor do they permit society-wide expansion of university education.
Strategies. For more than a quarter century, policymakers have debated establishing some means of compensating developing-world public universities for the emigration of their graduates (see Canadian studies: 1979A and 1979B). Proposed strategies include:
Any of these options would provide Africa's universities with the revenues needed to train replacements for professionals who emigrate. None to date have been implemented.