Illustration by Sana Amin/The Gazelle

The fall of oil prices from USD 100 per barrel to USD 30 per barrel in the last year has left many Gulf governments in need of fiscal consolidation. As NYU Abu Dhabi is largely funded by the Abu Dhabi government, many parties are worried about the university’s financial health and sustainability. To clarify such worries, The Gazelle interviewed Associate Vice Chancellor for Finance and Planning, Peter Christensen.

According to Christensen, NYUAD has left many startup costs behind and is now in a position to focus on growth. While he concedes that the low oil price does leave the Abu Dhabi government with “fewer resources to spread around its projects,” he believes that the university’s government partners are still committed to the project.

“In some ways we haven’t really seen the impact that maybe other organizations have because we are still on a growth trajectory,” said Christensen. “So the plan is that we are still growing. We are going have 150 more students on campus in next year’s class and would continue to hire new faculty and research fellows.”

While there have been concerns about the number of study-away allocations, Christensen believes that these changes are not motivated by budgetary concerns.

“They are mainly about having more structured academic programs,” Christensen said. “Some departments believe that they need a more cohesive approach to organizing study-away. This would also reduce the pressure put on [the programs in] NYU’s other academic sites.”

“I don’t see the need to change anything from the financial point of view,” said Christensen about summer funding related to courses and internships.

Christensen added that the NYUAD faculty is currently running over executive education programs for various organizations in the UAE. He argues that revenue from these programs enhances the university's financial independence from the government. The long-term plans to establish law, business and engineering graduate schools are also geared toward enhancing financial autonomy.

“These courses have been helpful in reducing our reliance on government funding,” said Christensen. “We are developing other revenue streams that help with the financial stability of the University. They allow us to be much more sustainable, so we are not relying on one funding source or the price of oil.”

Christensen also revealed that the university is assessing its current spending to ensure sustainability.

“We are currently reassessing many areas of administrative expenditures with a goal toward making the administration as efficient as possible,” said Christensen. “In addition, as the university grows in size, per capita spending in fixed-cost areas such as campus maintenance, operational subsidies for dining venues or staffing for non-academic departments would decrease naturally.”

Christensen further emphasized that faculty salaries, student aid and research grants will remain “sacrosanct” and he sees no plan or need to reduce any of them. Moreover, he added that the cooling and lighting management systems of the university’s buildings will be recalibrated to reduce the school’s energy footprint.

On the issue of private endowment, Christensen said that it may be another few years or decades before NYUAD can rely on endowment income and private donations to support its functioning. However, as the university continues to receive more external research funding and additional revenue from executive education courses and the letting of athletic and conference facilities, Christensen foresees “reducing the proportion of recurring government grant to about one third of the income mix.”