U Aung Chit Khin, Founder, Strategy First University: Interview

Interview: U Aung Chit Khin

How attractive is the sector for private investment?

U AUNG CHIT KHIN: Private pre-tertiary schools are very attractive for investment. This segment is high up on the Myanmar Investment Commission’s list of foreign direct investment priorities. Alongside demand from expats, which is recovering after a lull, there is strong domestic demand for such institutions.

While many parents believe their children are too young to be sent abroad for education prior to university – instead opting to enrol them in local international schools – many parents of children studying at higher education level will send them abroad, mainly to Singapore, Australia, Thailand and the UK. Subsequently, the domestic higher education market is less appealing to large-scale investment, although some opportunities exist. One interesting growth segment is bridge programmes, which are designed to prepare post-high-school students for further study abroad.

Across the region, education is becoming increasingly international and competitive. Many foreign universities are interested in encouraging students to apply to their undergraduate and graduate programmes. Meanwhile, countries such as Thailand, Singapore and Malaysia are facing issues related to ageing populations, which means that there is a smaller pool of students and institutions are competing with each other for applications. Thus, these institutions look to countries like Myanmar, Cambodia and Laos – which have young populations – to bolster their numbers.

Furthermore, online education offered by international universities is growing in popularity among students in Myanmar, which again increases competition for private universities. Due to all these factors, the scalability of investment in education in Myanmar is tough, and return on investment is expected to take many years. Nevertheless, there are a lot of investors interested in the market. Notably, significant opportunity exists for education institutions in the real estate market. If you have a campus and can utilise it for residential or commercial real estate purposes, it will be a hugely positive asset alongside education.

To what extent is an increase in university applicants affecting the higher education system?

AUNG CHIT KHIN: There are over 160 tertiary institutions in Myanmar. Due to an increasing number of students entering university age, however, combined with grade inflation, there are many more students now qualifying for certain courses at public universities, which is leading to a lack of supply for in-demand courses. There is abundant supply for students in the arts and social sciences; however, as public university applicants are assigned according to predetermined quotas, medical and engineering schools tend to be oversubscribed. This uptick in graduates, coupled with public universities’ limited capacity, has benefitted private sector institutions, and encouraged the movement of students into the private education system. Although more expensive, there is greater capacity in private institutions to accept students into most majors, and these institutions are often perfect for students looking to study bridging courses.

What can be done to address the skills gap?

AUNG CHIT KHIN: What children are being taught at primary and secondary school – and even some students at the tertiary level – rarely corresponds to market requirements. There is a mismatch between the skills acquired throughout their education and the ability to execute tasks in the workplace. Specifically, the development of soft skills, such as interpersonal proficiency, is not prioritised within education in Myanmar. This is particularly the case at public institutions.

Many private higher education institutions therefore offer micro-credential courses, in which working adults pursue modules focused on essential skills needed in the workplace. Between 2014 and 2019 this segment has grown exponentially, and shows no signs of slowing.