During Chinese engineering student Zhao Shuqi's years at Stockholm's Royal Institute of Technology (KTH), she has experienced an abrupt change in policy that has introduced fees for students from nations outside the EU. Zhao began her studies at KTH before fees were introduced in 2011, but since then she has paid a total of 290,000 kronor ($44,000), with the help of her parents and part-time jobs.

That's about ten years of income for the average urban resident in China, and what's more, once she has got her diploma, she is likely to be asked to leave the country, unless she does something about it.

"I must find a job before I graduate, or else I cannot stay," she said.

Since introducing fees Swedish universities have struggled to attract foreign students, and critics now warn its visa system pushes highly qualified graduates out of the country. Until 2011, Sweden was one of the few countries in the world to offer free university places to all foreign students, attracting nearly 8,000 in the final year of the scheme. But when fees were introduced for non-EU nationals enrolments dropped by 80 percent to 1,600 with the greatest fall-off among African and Asian students.

Sweden still offers stipends for particularly qualified post-graduate students from non-EU countries. But not enough to fill the empty seats left in lecture halls, like at KTH, which is one of Scandinavia's most prestigious centres of higher learning and receives 5,000 applications per year for foreign bursaries but can only offer 60 funded places.

KTH's president, Peter Gudmundson, said that foreign graduates have contributed to Sweden's industrial development and are seen as ambassadors for the country.

"It's quite common that they take jobs in Swedish companies outside Sweden," he told AFP.

But taking up jobs in Sweden is somewhat harder, unless students are recruited before graduation. In a recent op-ed article in the daily Dagens Nyheter, KTH president Gudmundson argued for a review of the fees decision and better visa arrangements.

His counterpart at Gothenburg University, Pam Fredman, co-authored the article and said that Sweden makes it too hard for students who have lived in the country for several years to get visas, and that Sweden needs better links between education and industry.

Carl Bennet, the head of a large investment fund, is one of several business leaders who has spoken out about the problem.

"We must create a basis for them to stay and work in Sweden," he said.

When foreign students finish their studies they face a race against the clock to find work and get employment visas before their student visas expire — just 10 days after graduation. Despite 76 percent of students saying they want to stay in the country and work after graduation, a mere 17 percent succeed, according to a report from Boston Consulting Group.

Apart from the cost of funding foreign students' studies, the decision to impose fees was necessary, said Tobias Krantz, the minister for higher education at the time and now head of education at the Confederation of Swedish Enterprise. The reason: large numbers of non-paying students distorted the education market.

"Swedish higher education must compete in the global market," he said, adding that overseas students should look to Sweden because they want to benefit from "a high level of education, not because the university entrance is free of charge".

Krantz believes Sweden can become a top destination for foreign students once again "if Swedish universities take on that challenge and they are given the right incentives to do so". With an ageing population and growing skills shortages, particularly in healthcare and IT, the government will come under increasing pressure from industry to tackle the graduate visa issue, however.

"In the future Sweden needs more, especially high-skilled, people to come to work here in order to preserve and maintain Swedish welfare," said Krantz. 

Ariane Picard/AFP/at