Market intelligence for international student recruitment from ICEF
25th Jan 2017

Russia: Education agents optimistic as economy strengthens in 2017

Three out of four Russian agents expect to refer more students abroad in 2017 than they did last year. This is one of the top-level findings of a survey of leading Russian education agents conducted by ICEF Monitor this week. It is also one of the latest indicators that the Russian market - which has been mired in a deep recession for the last two years - is now poised for recovery. responding-agents-expectations-regarding-volume-of-student-referrals-abroad-for-2017 Responding agents’ expectations regarding volume of student referrals abroad for 2017. Source: ICEF Monitor Many of the agents that responded to our survey explicitly cited the strengthening economy, and the improved performance of the Russian rouble in particular, in their forecasts for 2017. "The major factor for study abroad as well as for outbound tourism in general is currency exchange rate," said Pass into Europe CEO Ksenia Komrakova. "It is better now than it was in 2015/16, so people are more willing to go abroad to study." Simply put, the Russian economy found bottom in 2016. Two years into an economic downturn that was largely precipitated by falling commodity prices - and especially oil prices - the economy slightly outperformed analyst expectations for 2016. It still shrunk during the year, but less so than most had expected. And the forecast for 2017 is for modest growth, anywhere from .8% to 1.5% of GDP depending on who you ask. A recent update from the World Bank offers a growth projection of 1.5% for 2017 and notes, "After a prolonged recessionary period, headline economic and financial trends and indicators are now picking up. Inflation in January - October 2016 was 7.4% - less than half of the 15.9% in the same period in 2015. The banking sector has also now largely stabilised." As on the way down over the last two years, the path to growth this year has a lot to do with rising world oil prices, which have increased by about 20% over the last few months alone. And as goes the world commodity index, so goes the rouble. The Russian currency has strengthened against the US dollar by about 25% over the last 12 months. A year ago, it took about 80 roubles to buy a US dollar, today it costs just under 60 roubles. This is still some distance off the pre-recession exchange levels of roughly 30-35 roubles to the dollar (as of the beginning of 2014), but nevertheless represents a dramatic improvement over the exchange rate from early 2016. the-russian-rouble-US-exchange-rate-over-the-last-12-months The Russian rouble-US$ exchange rate over the last 12 months, during which time the rouble has strengthened against the dollar by roughly 25%. Source: OTC Interbank During the same period, the rouble has also strengthened about 33% against the Euro, and in the range of 20% (or better) against other major world currencies.

Travel outlook

Not surprisingly, the Russian tourism sector was marked by two contrasting trends over the last two years: international trips plummeted (down 24% last year) even as domestic tourism enjoyed a banner period with nearly 90% growth in 2016 alone. This is a vivid illustration of how an economy responds to crashing currency values: people still travel but they do so closer to home and with their local currency. The outlook for the year ahead, however, is again more positive as the economic recovery begins to take hold. ITB Berlin projects an overall 2% increase in Russian outbound travel for 2017. More recently, however, the Association of Tour Operators of Russia reported a 10% year-over-year increase in travel abroad by Russians during the 2016/17 holiday season.

Student travel in 2017

There are indications that Russian demand for higher education abroad was surprisingly resilient during the recession. UNESCO, for example, reports that Russian outbound for higher education was up 7.1% between 2013 and 2015, with about 55,000 students enrolled abroad in 2015. What we might expect now is that more discretionary student travel - such as language studies or camps - will also be on the upswing in 2017. Indeed, the agents responding to our survey this week weighted English language programmes, secondary school, and university studies as the areas of greatest demand for 2017. survey-respondents-weighting-of-the-areas-of-greatest-demand-for-study-abroad-among-russian-students-for-2017 Survey respondents’ weighting of the areas of greatest demand for study abroad among Russian students for 2017. Source: ICEF Monitor Survey respondents also noted the US, the UK, Canada, and Germany as the most attractive destinations for Russian students this year. survey-respondents-weighting-of-most-attractive-destinations-for-russian-students Survey respondents’ weighting of most attractive destinations for Russian students. Source: ICEF Monitor When asked what foreign educators can do this year to be successful in recruiting in Russia, responding agents offered a couple of consistent themes: be present and be responsive. These echo the similar points that we consistently see in the annual Agent Barometer survey, but it is clear as well that Russian agents want the institutions they represent to be directly engaged with marketing efforts in-country, whether that means education fairs, regional tours, staff training, or other direct support for the agent’s recruiting efforts. "In order to be successful in recruiting in Russia, educators need to be willing to actively participate in regional marketing," said Maksim Kostiuchenko of TravelWorks. "There are a number of regional and federal events and promotions organised, which help to educate the audience, provoke interest, increase brand awareness, and the number of students recruited. As 2016 showed, the more educator is involved and presented to the audience, the more recruited students it has." Another respondent advocated that educators be present in any way that they can whether "participating in workshops, in roadshows, or visiting partner agencies with presentations for the staff and potential students." And even with an economic recovery underway, some respondents cautioned that price sensitivity is still a factor in the market. One responding agent recommended that educators “still support the Russian and CIS markets with special deals and discounts, even the situation with currency rate becomes more stable, yet the financial matter plays one of the leading roles for students and their parents when they are choosing an educational institution.” For additional background on the Russian outbound market, please see: • "Strategies for a challenging year in Russia" • "Shifting currencies expected to drive growth for more affordable destinations" • "Russians weigh travel options as rouble plunges"

Most Recent

  • The rise of alternative destinations: Thailand, Poland, and the Philippines Read More
  • Comparing student visa proof of funds requirements across 20 study destinations Read More
  • ICEF Podcast: Start-ups in international education: disrupters or innovators? Read More

Most Popular

  • Canada’s foreign enrolment grew by more than 30% in 2022 Read More
  • Measuring cost of study and cost of living across study destinations Read More
  • Recruiting in the Emirates: Big goals, world-class education, and new scholarships Read More

Because you found this article interesting

The rise of alternative destinations: Thailand, Poland, and the Philippines A growing body of industry research shows that in 2024, international students are considering a wider range of...
Read more
France hosted 412,000 foreign students in 2022/23 Campus France has released its international student enrolment data for 2022/23, and in contrast to the double-digit percentage...
Read more
Hong Kong needs to build more student housing In his October 2023 address, Hong Kong Chief Executive John Lee set out some ambitious goals for the...
Read more
Canadian immigration minister releases official cap figures and targets for 2024 In many respects, the implementation of Canada’s newly established cap on international student enrolment has been shrouded in...
Read more
Australia: Record-high foreign enrolment but tighter immigration settings now taking hold The Australian government has further increased its scrutiny of international student applicants in an effort to ensure incoming...
Read more
Business school survey again signals declining non-EU enrolment in UK The most recent survey from the Chartered Association of Business Schools in the UK reveals that, “International student...
Read more
US study visa refusals reached record levels in 2023 More than a third of prospective international students applying to study in the US last year were turned...
Read more
Canada: More provincial cap numbers announced; IRCC moves up end date for post-graduate work for partnership programmes Since the Canadian government’s announcement in January that it would be capping the number of new study permits...
Read more
What are you looking for?
Quick Links