China Student Loan

In China, Student Loans May Be Expanding Societal Gaps They Were Supposed to
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By JIANG XUEQIN
Beijing
Last year in August, Ma Xiaoqing arrived in Beijing, unsure how long he could stay. A month earlier, after
years of diligent studying in a remote province, he had won admission to China Agricultural University, an
elite university. His parents had borrowed money from neighbors to pay for Mr. Ma's first year of college --
$1,000, four times his parents' annual income -- and sent him on a two-day train trip to Beijing, where he
had hoped to apply for a student loan to pay for the rest of his education. But after he arrived he did not
know how to begin, whom to talk to, or where to go. Alone and homesick, three months later, he called his
mother and said that he wanted to come home.
Mr. Ma's frustration is all too common today in China. In 1999, Chinese universities began for the first time
in China's history as a socialist country to charge tuition. Before that, universities were free, and graduates
were assigned jobs by the state. Beginning in the 1990s, graduates could finally choose their own futures,
and the government began to cut financial support to universities, forcing them to pay more of their own way.
While more opportunities for higher education were being created, students and their parents were being
asked to shoulder a large financial burden. So in the same year as tuition was instituted, the Ministry of
Education created a student-loan program to assist poor students.China, Student Loans
"Not one of the newly enrolled students will be deprived of the right to study because of family financial
difficulties," China's vice minister of education, Zhang Baoqing, said at the time.
Today Chinese universities charge an average of $600 annually, three-fourths of China's annual per capitaChina, Student Loans
income. Mr. Ma was getting a $140 discount off his university's usual tuition of $500 because he was
studying zoology, a department subsidized by the government because it wants more zoologists and the field
isn't a popular one. But the cost of room and board more than doubles the bill.
Mr. Ma's parents, like the vast majority of Chinese, are subsistence farmers, growing wheat on a small plot
of land on the remote plains of Guanghan county, in Sichuan province, earning little and saving nothing.China, Student Loans
During the Mao Zedong era they suffered immense poverty; then, when Deng Xiaoping came into power in
the late 1970s and freed the peasants from the communes, they saw their lives gradually improve. But in the
mid-'90s, as local officials steadily increased taxes, the national government drastically cut subsidies
supporting wheat prices, throwing peasants back into poverty.China, Student Loans