Back to school for education regulations

The government last week introduced Decree 73/2012/ND-CP dated on September 26, which provides long-awaited specific criteria for establishing foreign-invested education and training institutions in Vietnam such as required investment capital and the percentage of Vietnamese learners.

According to the new decree, foreign investors are allowed to establish “short-term” training centres, kindergartens for foreign children living in Vietnam, primary and secondary schools for foreign and Vietnamese students, vocational schools and universities.

For foreign-invested vocational schools and universities, the Vietnamese government gives no limitation on the Vietnamese student percentage, but there is a 10 per cent limit for Vietnamese pupils at primary and junior high schools and 20 per cent for Vietnamese pupils at senior high schools.

Nguyen Thanh Huyen, deputy director of the Ministry of Education and Training’s International Cooperation Department, said the decree also provided comprehensive guidelines for foreign investors to establish education and training institutions in Vietnam, opening their branches or cooperating with Vietnamese partners.

“The newly issued decree is expected to lure more foreign direct investment in Vietnam’s cash-strapped education and training sector,”  said Huyen. Though the Vietnamese government has been encouraging foreign direct investment in education and training sector, the result is still modest.  

Ministry of Planning and Investment (MPI) statistics show that foreign investors have jumped into 158 education and training projects in Vietnam, since the country opened door for foreign direct investment in 1987. Most of the established institutions provided short-term training courses.

Foreign investors have set up only three universities in Vietnam - RMIT University, Dresden University and British University Vietnam. Foreign investors, at the annual Vietnam Business Forum, usually blamed complicated investment procedures and unclear regulations as the main hindrances for them to invest in Vietnam’s education and training sector.

Lawyer Nguyen Thi Nguyet said the new decree provided certain improvements to allow foreign investors to provide education and  training services to Vietnamese students. However, she does not believe the decree can timely boost foreign direct investment inflows in the sector.

“The new decree is not completely satisfied to the desire of foreign investors because foreign investors would like to provide education and training services for Vietnamese students without any restrictions,” she said.

The new rule also regulates specifically minimum required investment capital at each level of education and training. A foreign invested kindergarten must secure a minimum investment fund of VND30 million, nearly $1,500 per child. Meanwhile, a foreign invested university in Vietnam must secure a minimum investment fund of VND150 million, or $7,211 per student.

“These are not new regulations since they were set out in Circular 14/2005/TTLT-BGD&DT-BKH&DT dated April 14, 2005. I think that these are reasonable requirements since the government wants to see that foreign investors have strong financial capacity to invest in the nation’s education and training sector,” said Nguyet.