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IN THE SPOTLIGHT
ISC Research Conference Shares Latest Market News
By Anne Keeling 30-Mar-18
Demand for international education is going from strength to strength in many countries of the world as international school options become increasingly accessible to families. At the ISC Research Conference, which took place near Oxford this January, the company’s field researchers shared some of the very latest intelligence and data about developments within the international schools market this academic year. ISC’s team of in-country research experts, based around the world, visits an extensive range of international schools in their regions, gathering directly from senior leaders crucial information on the demand, supply, challenges, and opportunities for international education. This research, combined with the company’s connections with leading school associations, government bodies, and other specialist educational sources, provides a highly comprehensive, independent picture of investment and development potential within the market. At the conference, ISC Schools Director Richard Gaskell described how international schools offering a Western style of teaching and learning in the English language, working towards globally-respected qualifications, have become the preferred route for an increasing number of international students aspiring to Western university. “Regardless of their country of origin, families in virtually every country, and well over 2,000 cities globally, have access to at least one—and often many—international schools catering to local children,” he said. Expanding global education options The chance to choose among different school types close to home has changed the way many parents approach their child’s education. As more international schools have opened, so parents in many countries have become increasingly aware that the two traditional solutions—either their country’s state education or a foreign boarding school thousands of miles away from home—are no longer the only two options available for their child. “Increasing affluence creates the chance for local aspirational parents to consider an independent, international school in their locality that offers their child quality education and a reliable pathway to some of the best undergraduate degrees in the world,” Richard said. “For the market to continue to expand, the challenge will lie in the quality of well-trained teachers who have the experience of delivering recognized curricula and academic rigor in a way that develops a student’s independent, inquiry-based learning skills, which are essential for higher education and in the workplace,” he added. Regional focus Susan Krumrei, Head of Field Research at ISC, shared news on the demand and supply in Europe, the most established and stable of the regional markets. “International schools in Europe predominantly cater to the expatriate market, and in some cities impacted by current geo-political factors demand for international schools is higher than it has been for years,” she said. “Several schools in Frankfurt have seen a rise in enrollment demand of up to 40 percent as companies, planning on relocation as a result of Brexit, are blocking places for their families.” Sami Yosef, Head of Asia, shared the news that Japan is now investing in more English-medium education. “With the economy improving, wages increasing, and the number of expatriates expanding significantly (up by 14 percent between 2014 and 2016), opportunities for international school development in Japan now look very good,” he said. As for Vietnam, Sami said that if Decree 73 were to be overturned, the cap on local children attending international schools would be lifted. A reduction on the restricted numbers is more likely, but discussions are ongoing. Sami also discussed the market in Thailand, highlighting the fact that international schools offering a Mandarin and English bilingual program are those most favored by local parents. ISC Field Researcher in South East Asia Sam Fraser told delegates that the mid-fee international schools sector has development potential throughout the region but, to date, has remained relatively untapped. “Because of the increasing number of expatriates with trimmed benefits packages, and the growing number of local families seeking out international education options, there’s a real need for such schools that more people can afford from their own salaries,” he said. In countries where the oil and gas sector dominates—such as Malaysia, Indonesia, and Brunei—Sam explained that enrollment demand is down by about 20 percent. “Although for some of the leading international schools, this has only impacted their long waiting lists,” he added. Linking Malaysia to Singapore is the state of Johor, which is currently under significant development with new and expanded oil and gas projects and a high-speed rail network connecting the two countries within 90 minutes. Sam indicated that a significant number of new international schools are predicted to open in Johor as a result. News from China ISC Field Consultant for China Grace Shi joined Sami Yosef to talk about the diversified international schools market in China. They told delegates that there is now a shrinking market for expatriate student enrollment in China. The one exception is in Guangzhou, where there is significant demand from Chinese families with foreign passports who are allowed by Chinese law to attend the traditional expatriate international schools (known as the Schools for the Children of Foreign Workers). In Beijing, where competition for expatriate students is fiercely competitive, the international schools are introducing additional language or bilingual offerings, and targeting specific foreign-owned companies to maintain their enrollment numbers. “Where demand is increasing in China—and at huge pace—is in the international schools that are accessible to local Chinese children,” explained Grace. “Waiting lists are extensive at all good international schools and much more school development is expected,” she said. Several schools are due to open, including the independent school brands of King’s College School and Lucton School in September 2018, Uppingham School in 2019, and Westminster School in 2020, all of which will be set up to accept Chinese children. Arlo Kipfer who joined ISC Research in 2017 to advise on international school development in Asia Pacific and who has expertise on the legal framework for foreign school investment in China, provided reassurance for future investors and developers. “The lack of certainty regarding private investment has hindered international school growth in China in the past,” he said. “However, recent increased clarity in the private education law has been a big benefit for investment, and certain school entities (kindergarten and secondary) can now legally receive dividends.” He warned schools considering opening sister schools in China: “There have been some epic disasters with investor partners in China. You really need to know the investor that you’re dealing with and the market you are reaching out to,” he said. The market in the Middle East Head of Middle East Research for ISC, Nalini Cook, highlighted the latest news that, as of 1 January 2018, all Gulf Cooperation Council (GCC) member countries and states (which include the UAE, Qatar, and Saudi Arabia) will begin implementing a 5 percent Value-Added Tax (VAT). She clarified that, while nurseries and tertiary education are currently exempt, schools are not. In other news from the Middle East, Nalini confirmed that the UAE international schools market is not yet saturated, as some believe. “Particularly in the sectors of mid-market, affordable education, and specialist provision such as Special Education Needs (SEN), elite sports, and bilingual schools, opportunities for development are ripe,” she said. Nalini also advised delegates to watch out for new potential in Saudi Arabia. “Vision 2030 requires a well-educated young population to bring skills and expertise to the country,” she explained. “It may be a challenging market to invest in right now, but doors are starting to open,” she said. “If the law allowing 100 percent foreign ownership of education comes into effect, there will be huge opportunities for investors in Saudi Arabia in the near future.” The conference included a presentation by ISC Latin America Field Consultant Janet Wolpert, who highlighted the significant expansion of school groups in Mexico, Peru, and Colombia. “School accreditation is increasingly important to parents as a way of ensuring quality education for their children,” she said. The conference ended with a presentation on the IS market in India, which looks set to expand significantly in the coming years.
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