Vietnamese higher education as an investment
After the end of the Vietnam War in 1975, followed by reunification in 1976, the country’s higher education was rebuilt following the Soviet model. The fall of the Soviet Union and the introduction of the Doi Moi policy started opening up Vietnam’s economy to the world by the early ‘90s. The Government undertook comprehensive reforms to increase the quality of education. Through the founding of new higher education institutions (HEIs), multi-field and multi-disciplinary universities offering Associate (college), Bachelor/ Master’s (university) and PhD programs (research centers) started welcoming students. The first fully foreign funded university was established in the year 2000, after a Government decree incentivizing foreign investment in higher education was issued. Today, establishing a foreign university in Vietnam requires nearly €40m of secured capital, years of administrative procedures and direct approval from the Prime Minister of the country.
In 2007, a credit system similar to ECTS was introduced, though its implementation still presented many weaknesses. Joining the WTO in 2007 accelerated reforms aimed at better preparing graduating students to the expectations of the job market. However, severe disconnect remained between HEIs and scientific research, businesses and employers as academic research and PhD studies were still conducted in specialized and officially entitled research centers, outside of universities.
The arrival of the big IT, electronics and automotive multinationals in Vietnam improved the situation by establishing high tech research centers and industrial parks. The 2012 Higher Education Law set a target of increasing the number of master’s and PhD students, with the goal of training 20,000 PhDs by 2020, half from Vietnam and half from overseas. In 2015, there were 77,000 higher education teachers/lecturers in Vietnam, out of which only 9,126 had PhDs and 36,347 had master’s degrees. The reform highly encouraged foreign exchange programs and joint degree programs especially with partial studies at a foreign university. For the first time in 2019, 3 Vietnamese universities were listed in the Times Higher Education ranking, and some private HEIs acquired international accreditations.
The Covid-19 pandemic of 2020-2022 forced all institutions to switch to distance learning partially or completely, which pushed both public and private institutions to digitalize and modernize day-to-day operations and teaching. While the need for in-person learning has not decreased due to the pandemic, institutions and authorities in Vietnam have opened up to digital solutions and are expected to build these into their operations more and more. We suspect that the developing higher education infrastructure will move in a digital direction, likely more quickly than their European counterparts, which already have considerable brick-and-mortar infrastructure. Education Technology (EdTech) providers, fully online degrees and blended learning approaches are showing a lot of promise, although convincing students of the quality of these offers remains a challenge.
Studying abroad
The first private HEIs were established in the ‘90s, due mainly to the fact that the demand to enter the higher education system was more than 8 times higher in the ‘90s, and five times higher in 2005 than the number of available places. To this day, nearly one million Vietnamese students cannot enter the Vietnamese public education system each year. They can either enroll in private institutions or study abroad. In 2015 there were 498 registered HEIs, out of which 93 were private. These HEIs still operate on a strict quota-based system and some private HEIs’ educational quality remains dubious.
This situation and the emergence of the Vietnamese middle classes led to an increased demand for studying abroad. Out of the nearly one million students per year who are unable to get into public HEIs, 126,000 (2022) students continue their studies outside of Vietnam. The main target countries in 2022 were Japan (40,000), the USA (26,000), Australia (17,000), Korea (13,000) and Canada (7,000). 90% of these students are self-funded and are interested in business and social science degrees. CEE countries attract significantly less students, the Czech Republic and Hungary have around 500 Vietnamese students, Poland 270, and Bulgaria and Austria each receive around 100 of them per year.
Even though there are over 300 student recruitment companies in Hanoi alone, the key players remain the international organizations, state owned Vietnamese or foreign companies and NGOs. Reliability is one of the key factors of the successful operators given the traditionally high risk of visa exploitation in Vietnam.
The preference for English speaking countries, or countries where English is the language in which courses are taught, as study abroad destinations means that the demand for young Vietnamese to learn English is strong and continuing to grow. Parents can choose between bilingual schools, international schools, or independent English language centers if they wish to go beyond the level of English language education provided by the public education system. Many consider studying abroad as a time and cost-effective way to reach native level English knowledge. The English language learning industry used to be fully in-person pre-pandemic. Post-pandemic however, this industry also seems to be moving towards the more affordable and flexible distance learning model.
CEE’s higher education is hardly represented on the Vietnamese market. Although competitive tuition fees and high-quality education (not forgetting CEE countries’ traditionally „friendly” status with relatively safe and secure policies towards Vietnamese students) could be an alternative for Vietnamese seeking affordable studies abroad. With the notable exception of Poland and Hungary, CEE governments and HEIs have not yet started actively promoting themselves in Vietnam as a study abroad destination. Traditional barriers for CEE players in this market are the availability of programs taught fully in English at the host institution, quality and ease of life in a country where English is not the official language, and lower (compared to Anglo-Saxon countries) or non-existent scholarships for Vietnamese students.
Author
Csaba Bundik
CEO – CETA Consulting
Vice-Chairman – CEEC
Csaba Bundik is active in management and consulting, business development and venture capital fields, and maintains excellent networks across South East Asia, Europe and the US.
He was the co-founder of the Hungarian asset management company CETA Consulting Ltd. Csaba formerly served as Executive Director of EuroCham Vietnam.
Ben Mandjak
Business Development Manager – CETA Consulting
Board Member – CEEC
Ben is a Hungarian national and holds an MSc in Management from IÉSEG School of Management in Lille, France. He has been living and working in Vietnam since 2018.
Prior to this, he acquired a wide range of experiences in developed and emerging markets, while living in France, Germany, Togo and Hungary.
Ben is Head of the Representative Office of Hungarian company CETA Consulting Ltd. in Hanoi. He is fluent in English, French, German and Hungarian.