return icon Vietnamnet.vn

Foreign investors increasingly drawn to VN education sector

According to the General Statistics Office, foreign investment as of October 20 was US$23.48 billion, equivalent to less than 81 per cent of the figure for the same period last year.

{keywords}
Illustrative Image. The Ministry of Planning and Investment’s foreign investment department said as of September 20 FDI in the education sector was up nearly 58 per cent to US$78.9 million.— Photo baodautu.vn

Most sectors saw big declines due to impacts of the Covid-19 pandemic, but the education sector stood out.

The Ministry of Planning and Investment’s foreign investment department said as of September 20 FDI in the sector was up nearly 58 per cent to US$78.9 million.

Schools offering all levels of education from early childhood to tertiary attracted the most FDI of around $5.28 million, or nearly 35 per cent of all new FDI coming into the sector.

The British Virgin Islands, South Korea, the US, and Singapore were the biggest investors in the sector, with the British Virgin Islands ranking top with $23.68 million.

Diamond Crest Global Limited of the British Virgin Islands was the biggest investor, putting in $17.6 million in Hanoi-based international education establishment, Thien Huong.

What accounts for this interest in the Vietnamese education sector among foreign investors?

According to David Ireland of Navis Capital, many investment funds are interested in this sector because Vietnam has in recent years achieved the highest GDP growth rate in Southeast Asia and has a young population and thus high spending on education.

Market room 

A plan to develop the country’s universities and junior colleges in 2006-20 approved by the Prime Minister targets having 30-40 per cent of students at private higher education establishments by 2020. But the current rate is only 14 per cent.

As of last year there were only five foreign-invested universities in the country in addition to 68 private universities and 170 state-owned ones. Non-state education at all levels makes up just 7 per cent, and accounts for 6 per cent of the total number of students.

However, public schools and universities have failed to meet the growing demand.

The number of students who want to study aboard continues to increase year after year as many hope to get international certificates to get jobs at international companies.

The demand for international standard education from the expatriate community is steadily increasing.

According to the Ministry of Labour, Invalid and Social Affairs, since 2013 the number of foreigners licensed to work in the country has been growing at 4.2 per cent annually.  

This means the education sector is in great need of all-level schools with competitive tuition fees that can offer quality education and, most importantly, grant international certificates that are accepted by major companies, especially foreign ones.  

So, Vietnam’s education market remains a promising one for foreign investors.  

Policy and development

The Higher Education Law was amended to include many new provisions like giving greater autonomy to universities, including financial.

The move has created more opportunities for non-State players, including foreign, to be involved in the education sector.

Analysts said foreign investment in the education sector remains modest compared to the market’s potential, accounting for less than 2 per cent of total FDI.

The main barriers to foreign investors’ entry into the education sector are minimum requirements in terms of capital and personnel and complex procedures.

They need an investment amount of at least VND1 trillion (over $44 million) to set up a tertiary education institution, while a campus of a foreign-invested university is required to have minimum capital of VND250 billion.

Experts believe however that these barriers can no longer prevent foreign investors from entering the education sector since recent policy changes have created more favourable conditions for them, making them feel more secure about investing in the sector.

They point to Decree No 86/2018/NĐ-CP on foreign cooperation and investment in education, for instance.

It replaced Decree 73 and applies to foreign co-operation and investment activities in education from early childhood and primary, secondary, and tertiary levels. It increases the rate of students at foreign-invested education establishments from the earlier maximum of 10 per cent to 50 per cent.

Thanks to this, international schools have seen and will continue to see a sharp increase in the number of applications.

Joshua James of EuroCham told Vietnam Investment Review newspaper that foreign investment in Vietnam’s education sector would continue to rise from now on since the country’s profile has risen significantly thanks to its success in combating Covid-19.

The country’s growing young population and its great efforts to achieve high economic growth also make its education market attractive, he said. 

More efforts to push exports to EU

The Ministry of Industry and Trade’s export-import department has said it will allow shipments bound for the EU before August 1, when the EU-Vietnam Free Trade Agreement (EVFTA) took effect, to get a certificate of origin (C/O) to enjoy preferential tariffs set out in it.

Consignments that were transported to or stocked at warehouses, bonded warehouses and tax-free zones within 24 months before August 1 can ask related agencies to issue the C/O under the EUR.1 form to be able to enjoy the tax breaks under the EVFTA.

Those not within the 24-month time frame but stuck in bonded warehouses are also eligible.

But the ministry and EU partners will negotiate on a case-by-case basis and take a decision on each.

In the two months since the EVFTA took effect, the trade ministry has granted 24,000 EUR.1 certificates of origin to Vietnamese goods worth nearly US$1 billion.

The EVFTA is an ambitious agreement that eliminates almost 99 per cent of custom duties between Vietnam and the EU, with 71 per cent of tariffs on Vietnamese exports scrapped after the agreement took effect and the rest over a period of seven years.

Sixty five per cent of duties on EU exports to Vietnam will be eliminated immediately and the remaining over the next 10 years. VNS

Compiled by Thien Ly

Vietnamese education lures over US$4 billion foreign investment capital

Vietnamese education lures over US$4 billion foreign investment capital

The number of foreign investment projects in Vietnam's education sector have increased by 321 compared to five years ago, the registered capital has also increased by over US$3.5 billion.

MORE NEWS

Challenges ahead for Vietnam this year

“Pressure”, “increased difficulties” and “high risks and challenges”: these are the words used by the Minister of Planning and Investment to describe how hard it will be to fulfill Vietnam’s growth goals this year.

Some industries lack orders, others cannot take more

While woodwork companies are lacking new export orders amid high inflation in the US and Europe, food-processing companies are not receiving new orders because of rising input material prices.

Wholesale and retail sectors lead in new foreign investment approvals

The wholesale and retail industries took the lead in new foreign-invested projects in the January-September period, according to the Ministry of Planning and Investment.

Vietnam cracks down on IUU fishing ahead of EC inspectors’ visit

Deputy Prime Minister Le Van Thanh has ordered strengthening inspections to ward off illegal, unreported and unregulated (IUU) fishing as European Commission (EC) inspectors are coming to Vietnam in October.

Phuoc Thinh to represent Vietnam at Mister Tourism World 2022

Vietnamese model Phung Phuoc Thinh is set to compete for a title at Mister Tourism World 2022 due to take place in the Philippines this December.

Vietnam, Kazakhstan to open direct flights in October 2022

The Civil Aviation Committee of Kazakhstan has officially licensed Vietjet Air to launch direct flights between Vietnam and Kazakhstan.

Vietnam among seven economic wonders of worried world: Financial Times

A writing published by the London-based Financial Times on September 26 described Vietnam as one of the seven economic wonders of a worried world.

UNICEF vows to support Vietnam in response to Typhoon Noru

UNICEF Vietnam expressed its concern over children and families in the country vulnerable to Typhoon Noru, saying it stands ready to support the Government of Vietnam in responding to the most powerful storm to hit Vietnam in 20 years.

President Nguyen Xuan Phuc attends state funeral of late Japanese Prime Minister

Politburo member and President Nguyen Xuan Phuc led the Vietnamese delegation to attend the state funeral of late Japanese Prime Minister Abe Shinzo in Tokyo on September 27.

President meets foreign leaders attending state funeral of late Japanese PM

President Nguyen Xuan Phuc held bilateral meetings with some foreign leaders attending the state funeral of late Japanese Prime Minister Abe Shinzo in Tokyo on September 27.

Assistant Deputy PM prosecuted for allegedly taking bribes

Criminal proceedings were launched against Nguyen Quang Linh, Assistant Standing Deputy Prime Minister Pham Binh Minh, on September 27 for allegedly taking bribes in the scandal related to COVID-19 repatriation flights.

VIETNAM NEWS HEADLINES SEPTEMBER 27

Noru heads toward central Vietnam, rain starts to fall

Dortmund legends touch down in Vietnam ahead of charity match

A team of legends from German side Borussia Dortmund landed at Tan Son Nhat International Airport in Ho Chi Minh City on September 26 to prepare for a charity match against veteran and young Vietnamese footballers slated for September 28.

Vietnam disciplines senior officials for involvement in bribery case

The Party Central Committee’s Secretariat has decided to expel Deputy Foreign Minister To Anh Dung from the Party for violations he committed relating to the organization of repatriation flights for Vietnamese citizens abroad during the pandemic.

VIETNAM BUSINESS NEWS SEPTEMBER 27

Vietnam’s economy to expand 7.2% in 2022: WB
back_to_top