China's university tuition fees top savings lists

BEIJING, Jan 13 (Reuters) Tuition fees for Chinese universities have soared over the past two decades and are now the top item on consumer spending lists, state media reported.

Tuition fees, ranging from 5,000 yuan to 10,000 yuan a year, are more than 25 times those of 1989, the China News Service said yesterday, citing a report by the China Youth and Children Research Center.

By comparison, average incomes among urban residents have risen by a mere four times over the same period, it said.

Under Chinese law, students are liable for only 25 percent of their higher education costs, but in practice parents are often made to pay up to 44 percent, creating a huge burden on many families.

Rising costs have become a major cause of distress among college students and there have been reports that high school graduates from rural areas whose families cannot afford the fees have resorted to suicide.

China withdrew much of the state subsidies to universities, once almost free, in the mid-1990s amid market-oriented reforms.

Universities have significantly expanded enrolment but questions of cost and quality have also arisen.

China has one of the world's highest savings rate at 40 per cent and state media have said that could be attributed to families putting money into the ''New Three Mountains'' - medicine, housing and education.

''Three Mountains'' was a term coined by China's Communist Party to denote feudalism, imperialism and capitalism in the first half of the 20th century.

REUTERS SY RAI0855