ValuStrat provides consulting services to several educational investors and operators in the region so as to assist them on financial matters, enhance operational efficiencies as well as expand network across geographies.
Quality education plays a key role in the economic development of any nation. This fact is clearly evidenced from past experiences of countries/regions such as Singapore, Ireland, Korea, and the European Union during the last five decades. The GCC member nations have also identified sound educational systems as being the cornerstone of economic progress and taken several initiatives aimed at improving the quality and quantity of education over the last two decades. As a result of the governments’ thrust, the region has witnessed a marked improvement in the quality of education. For example, Saudi Arabia in 2004 set forth a ten-year strategy focused on economic development and improving the quality of human capital. Likewise, the UAE released a draft document listing comprehensive reforms in the education sector in 2007. As a part of education sector reforms, the GCC region witnessed an increase in public expenditure on the sector. Government spending on education, as a percentage of total government expenditure, across the Middle East and North Africa (MENA) region increased from 12.7% in 1985 to 19.3% in 2008. In the UAE, this percentage increased significantly from 10.4% in 1985 to 27.2% in 2008; while it increased from 10.1% to 19.3% in Saudi Arabia during the same period.
The education sector in the GCC is poised for robust growth in the future on the back of increasing population, rising private sector participation, and increased willingness of parents to ensure high-quality education for their children. Earnest intention of the governments to improve the coverage and quality of education in their respective countries through various reform measures also bodes well for the sector.
In particular, prospects appear bright for operators and investors in the private school segment across the region. Growth in the Saudi Arabian private school market is expected to be fueled by recent regulatory developments. Moreover, superior quality of education provided by private schools in the GCC is stimulating migration of students from public schools to the private counterparts. The private higher education segment, which is relatively under-developed, is also likely to grow in the future as new private and foreign universities set up operations in the region.
