Market News

By Bayo Wahab

The University of Dundee in the United Kingdom has been hit with a financial crisis due to President Bola Tinubu’s administration’s devaluation of the naira.

According to The Sunday Times, Shane O’Neill, the institution’s interim principal, blamed the crisis partly on a “severe drop” in international student recruitment.

Other factors contributing to the institution’s financial crisis allegedly include mismanagement of funds and extravagant spending by the university’s senior staff.

O’Neill was quoted as saying that the deficit scale had been “lurking for quite a long time and has only just been fully understood.”

Before the drop in foreign student enrollment, the university reportedly generated nearly half a billion pounds annually for the city economy and three times as much for the UK economy. One-third of these revenues came from tuition fees.

External auditors have been recruited to examine the institution’s finances as the university prepares to cut over 600 jobs to address the problem.

Seven other Scottish institutions are said to be facing a similar crisis.

According to The Sunday Times, Edinburgh University has already warned its staff that “nothing is off the table” as the institution moves to make savings to its £140 million financial black hole.

Since last February, the UK economy, which is largely dependent on its education sector, has been showing signs of distress. This was evident in Enroly’s report indicating a 37% drop in foreign student applications compared with the previous year.

Enroly is an online platform used to recruit international students.

The main reasons cited for the drop are the Nigerian currency crisis and government visa rules initiated to curb migration.

The Times previously showed that Nigeria was providing more students than the EU countries combined, at 33,000. However, due to the naira devaluation and new visa rules, this has fallen by 71%.

Recall that President Bola Tinubu devalued the naira in 2023, barely a month after his administration commenced. 

The policy saw the naira plummet against the US dollar from an average of N388/USD in January 2023 to over N1600/USD in August 2024, while the pound, which exchanged for the naira at N519, spiked to over N2000/GBP within the same period.

The foreign exchange crisis put financial pressure on UK universities that rely heavily on foreign entrants for stability.