AUM slashes fees as project faces complete failure

The much-lauded American University of Malta (AUM) project is facing a very bleak future with almost no students on campus and millions in accumulated losses, according to its latest audited accounts.

In an aggressive marketing campaign launched a few weeks ago, intended to lure new admissions, the AUM has announced the slashing of its tuition fees offering students courses for close to nothing.

The university was a project by disgraced former Prime Minister Joseph Muscat that led to a great deal of controversy over prime public land allocated to a Jordanian developer with no experience in the education sector. Muscat had promised the AUM was ‘the key to an economic overhaul in the south of Malta’.

Since its inception, the AUM has had difficulty attracting the number of students promised. Now, the university is marketing lower fees as a reaction to the pandemic.

The AUM is also facing bleak financial prospects as the project is several million in the red, with liabilities far outweighing assets and an €11 million loss in its first three years of operations, according to its audited accounts.

Provost Narcisa Roxana Moşteanu did not reply to questions by The Shift about the student situation at the AUM and the university’s financial situation.

American University of Malta

Provost Narcisa Roxana Moşteanu.

The National Commission for Higher and Further Education (NCHFE), which issued the AUM’s operating licence, also refused to provide any details.

The government’s higher education regulator is tasked with ensuring the AUM is sticking to its original commitments, on which the licence was based. Yet its spokesperson told The Shift that no data could be divulged as this was ‘private’ information.

In 2015, in a highly publicised press conference, then-NCHFE Chairman Martin Scicluna had justified the issue of a university licence to Sadeen Group, actually a company owned by Jordanian developer Hani Hasan Naji Salah, on the grounds that specific commitments had been made.

According to Scicluna, by the fourth year of its operations, the AUM had to have a student population of 1,200 students, which would continue to increase to 10,000 by its tenth year of operations.

Former NCHFE chairman Martin Scicluna.

Although the AUM is in its fourth year of operations, The Shift is informed that the number of students does not even reach 150.

According to the university’s most recent accounts, published only a few weeks ago for the year ending 2019, the university has failed to make any significant income from tuition.

The accounts of the AUM’s operating company, Sadeen Education Investment Ltd, show that the AUM had registered more than €11 million in losses in 2018 and 2019. It also had multi-million euro loans with its owners.

The AUM was one of the first controversies of the Labour administration when Muscat had announced that the government had conceded massive tracts of untouched land – known as Iz-Zonqor in Marsascala – so that the Jordanian company could build its university campus.

Following protests, the government had to revise its position by reducing the footprint of the public land in Zonqor and giving Sadeen Group historical buildings in Cospicua to turn into a university campus.

Even though the project did not take off, the Jordanian is still in possession of the land in Zonqor where the plan is still to build a ‘residential complex and facilities’, with uninterrupted sea views.

AUM slashes fees as project faces complete failure