Carla Chahrour

The American University of Beirut in Lebanon faces a shortfall in revenues with real losses amounting to $30 million in the current year, and an all-in revenue reduction of $249 million for the 2020-21 period as a result of the collapse of the Lebanese economy, compounded by the COVID-19 pandemic and associated global recession.

This is the collective result of multifactorial crises facing the country, which have reflected onto the university in the form of major reductions in dollar-based external scholarships announced to AUB prior to the pandemic, a projected increase in required assistance for continuing students who already receive financial aid, large reductions in patient volume at AUB Medical Center, and a stable percentage of uncollected healthcare bills from the government.

In a university that has been cultivating an aggressive growth model, which has placed it among the top 200 in the world by several ranking criteria, the unprecedented consequences of the current circumstances have forced it to undergo a battle for survival, which has been described by the AUB President Fadlo Khuri as one of the greatest challenges since it’s inception in 1866.

“Most organizations do not survive such rapid and severe drops in revenue, and indeed many private higher education establishments around the world will not survive the revenue shock that each one is currently projecting in the aftermath of the COVID-19 pandemic,” Mr. Khuri said in a letter to the AUB community Tuesday, adding that “Like others among the greatest universities in the world, we must fundamentally change in order to survive.”

The changes under exploration mentioned in the letter include a possible “closure of an as-yet undetermined number of programs and departments, the departure of a number of community members, furloughs, a halt to capital expenditures, a near complete cancellation of university sponsored travels, leaves and conferences for the foreseeable future, and a review of the current benefits system.”

“Anything that is not deemed mission essential will likely prove to be a luxury that we can no longer afford, given the accelerating pace of Lebanon’s economic meltdown, the COVID-19 pandemic, and the expected global economic depression,” Mr. Khuri said.

The shortfall in revenues have ultimately resulted in losses that will almost entirely exhaust the contingency funds that the university has built up over the past five years, consequently,  financial cuts will have to come from almost every area of the university, according to Mr. Khuri.

“Under the best market circumstances, this deficit is beyond the capacity of the university to absorb for even one year. The economic situation in Lebanon is unlikely to change this picture for the better for some years to come,” Mr. Khuri said.

While difficulties are nothing new in the annals of a university that has faced a variety of trials and tribulations, including the survival of the 1975-1990 Lebanese civil war, Mr. Khuri stressed on the difficulties that will need to be faced in the forceable future.

“Make no question and have no doubts, everyone will be affected—from our senior leadership which will take significant pay reductions, to faculty members who have seen their buying power reduced, to students and their families who are struggling more than ever to pay tuition fees, to our staff who comprise our most financially challenged group,” Mr. Khuri said.

Nonetheless, Mr. Khuri assured both, staff and students that the administration has been working assiduously and around the clock to save the university that has served as a pillar of education not only in Lebanon, but in the region as a whole. Adding that consultations will be carried out during this coming month to finalize a new budget to be presented to the AUB community on June 15 in a letter outlining the savings that underpin it.

“We will do everything we can and must to save it. It is my deep conviction that Lebanon and the region have no hope whatsoever if AUB cannot fulfill its mission. Saving AUB must be our only priority. And save it we will,” Mr. Khuri said with determined optimism.