[photopress:mba_zhou_ji.jpg,full,alignright]First know that this problem is not confined to China. It is worldwide. Yes, there are universities such as Harvard which have been left huge endowments in the billions of dollars. But they are the exceptions not the rule. Normally the problem is the limit to the fees that can be charged to the students and the very high cost of the infrastructure of an university.
On top of this Chinese has other problems and State Councilor Chen Zhili has said that the problem of Chinese universities’ huge debts should be put on top of governments’ agendas.
Chinese universities are said to have total debts of RMB200 billion (US$27.4 billion) and the National Development and Reform Commission, China’s top economic planning body, said the debts have affected the operations of some of them.
Jilin University, the biggest university in China in terms of the physical area of the school, acknowledged last March that it is almost RMB3 billion in debt after having built eight branch campuses across China since 1987.
That is the amount owing. The interest alone is RMB170 million a year. And Jilin has to care for 63,000 students.
Education Minister Zhou Ji, seen smiling reassuringly in our picture, told a news conference in September that the problem was not ‘that serious’ and was only ‘a special problem in the country’s education development path.’ Zhou Ji admitted at the conference that, without going into detail, corruption, mismanagement and extravagance were involved in some of the debts.
Universities across China have taken out RMB200 billion in bank loans since the country started college expansions in 1998.
Zhou Ji takes the view that these infrastructure projects now have an estimated value of more than RMB500 billion given the country’s booming real-estate industry. He said land sales would be a reasonable choice to offset the financial crisis in the universities.
The Ministry of Land and Resources rejected that proposal, saying universities are not legally allowed to sell their land.
It is something of a mess and one that needs to be solved in the near future for the education of China depends on it.
Source: Shanghai Daily