SEOUL (Reuters) - The global credit crunch has caused investment banks to crumble, stock markets to plunge and South Korean parents to wonder if they can still afford to be the world’s largest exporter of foreign students to U.S. schools.
The South Korean won has been one of the worst performing currencies in Asia, losing a third of its value in two months, and raising the cost of tuition for education courses in the United States by tens of thousands of dollars.
“It is not what my parents had expected,” said Lim Jun-beom, 27, who was planning to enroll in February but is now rethinking his plans. “The mood at home is not that great. Maybe I’ll wait until August at least.”
For many South Korean parents, overseas education is a way to give their children a leg up in a highly competitive school system at home, or to escape it entirely.
They spend about $5 billion a year to send their children to schools abroad, a sum equivalent to about 20 percent of government spending on education.
South Korea is the biggest supplier of foreign students to education institutions in English-speaking countries such as the United States and Australia.
For children as young as seven, to adults seeking post-graduate degrees, spending years away from home to get an education in English has become a way of life in South Korea.
This has spawned a new class of parent called “wild geese fathers” who send their families abroad while they live in South Korea in spartan style to help pay for the overseas education.
For “wild goose” father Park Seung-chul, the embattled won means he may be able to reunite with his two sons studying at an elementary school in California sooner than he and his wife had planned.
“We should be able to find something here, for a lot less money,” Park, who runs a small trading company, said, adding he may wait until the won recovers strength, and when his sons are older, to send them back to schools in the United States.
As fiscal authorities and the central bank try desperately to keep the country’s economy afloat, many people who had mapped a plan to pay for their children’s education are feeling the pain.
“It’s tougher as the exchange rate rises,” Rhee Young-woo said of paying for his son’s university education in Tokyo.
“I send him 10,000 yen every month and it used to cost only 850,000 won ($687) to 1 million won. Last month I had to pay 1.2 million won for the same amount.”
The government of South Korea’s resort island of Jeju is trying to find a niche in the education marketplace by setting up an international school village where Korean children can study entirely in English at private schools, thus saving their parents from sending them abroad.
Many students are putting off their plans to study abroad until the won gathers strength, and some of them are biding their time at preparatory schools, also known as cram schools, studying English and improving their scores on standardized tests used by universities in the United States.
Yet even if the won recovers, university fees in the United States might be ratcheted up as colleges mull sharp fee increases to offset shrinking endowments due to stock market turmoil. Tuition is already steep with fees around $50,000 per year at many private colleges in the United States.
An office worker in Seoul, who declined to be identified because she had not told her boss about her plans, said she may delay graduate school in the United States for a year, hoping that the Korean won’s struggle will be over by then.
Although, she said, she may have to drop her study plans altogether if the real estate market continued to slump because she had planned to fund the studies with the rent she would collect on a flat bought at the height of the property boom.
“It makes a big difference in terms of how much it’ll cost me, and it will have an impact for a number of years,” she said.
Editing by Jon Herskovitz and Megan Goldin