Education players eyeing Vietnam
  • | Asia One | January 19, 2010 10:17 AM

Vietnam is an emerging economy that's trying to catch up with the world, with education playing a key role in its economic development. Singapore has taken a similar route with great success.

Education is in big demand in Vietnam - and Singapore, which has the experience and has built up strong expertise in that area, can help the Vietnamese there.

'Vietnam is a market with good potential for Singapore education players,' says Chiong Woan Shin, the regional director for Vietnam and Cambodia at International Enterprise Singapore's international operations group.

A close look at the Vietnamese market for education makes it even more enticing.

Ms Chiong points out that Vietnam has a young population with many of them shifting to big cities to look for jobs and schooling. The result: an enlarged population in these cities which provides a bigger market for pre-school education business.

Indeed, the demand for pre-schools has grown so fast that the Vietnamese government is turning more to the private sector to help cope with it.

Vietnam's online newspaper VietnamNet Bridge reported that in 2008, some 60 per cent of the children in Hanoi went to private kindergartens because state-run ones were overloaded.

Ms Chiong says the Hanoi district government is targeting to expand the private sector's share of pre-school students to 25 per cent in 2015, up from 15 per cent now.

Rising affluence also fanned the demand for better education. In the three years to 2008, Vietnam's per capita income jumped from US$723 to US$1,024, according to government data. This means a strong compound annual growth rate of 19 per cent.

The growing sophistication in demand is reflected in the popularity of bilingual education (Vietnamese and English) and schools that offer international curriculum.

'When Singapore pre-school operator NTUC First Campus' Little Skool-House International entered the Hanoi market to take over an existing pre-school in March 2009, enrolment for that centre more than doubled,' Ms Chiong says.

The demand is not confined to pre-schools. Ms Chiong notes that the Vietnamese government is also keen to build a strong workforce for economic development. It is thus beefing up vocational training.

'With industrialisation and modernisation, there is rising demand for adequately skilled manpower in Vietnam,' Ms Chiong says.

Vietnam's Ministry of Labour, Invalids and Social Affairs reported that only 21 per cent of the country's manpower were sufficiently trained in 2006. It aims to boost the figure to 26 per cent by this year.

The ministry sees strong demand for vocational skills in sectors such as mechanical engineering, construction, programming and farm product processing.

'Singapore, having the relevant history and experience in upgrading our manpower needs to meet the changing economic structure over the years, is well-positioned and has the competitive edge to offer vocational and technical education,' Ms Chiong says.

Gina Kek, assistant director of business services division in IE Singapore's corporate group, says Singapore education providers have an edge over other competitors in Vietnam because Singapore has a brand name for quality and reliability.

Singapore's well-established bilingual education system will appeal especially to Vietnamese parents.

'Singapore is known for our high quality, well-researched and international and bilingual education programmes,' she says.

Singapore's education providers - both for pre-schools and vocational and technical schools - also have a strong track record in exporting their services to Asian markets.

Pre-school operator Crestar, for instance, first ventured into the region in the early 1980s and is now a familiar name in China. Nanyang Polytechnic tied up with the World Bank in 1998 to help reform the Chinese vocational and technical education system.

But Singapore's reputation for education services recently took a beating because of cases of errant providers and engagement of untrained local agents. These have made Vietnamese parents wary of Singapore schools.

'These errant education players and irresponsible, untrained local agents have entered the market without proper business plans and have simply hoped to make quick profits,' Ms Chiong says.

But despite this setback, she says Vietnam remains a market with great potential for education providers.

'Education providers who provide quality services and are seriously looking to enter Vietnam for the long haul should not be discouraged,' Ms Chiong says. 'It is important to bear in mind that while education may be a business, it is also a social good.'

So short-term profit motives must be tempered with a long-term goal to do social good.