Expanding Vietnamese Private Higher Education

Recommendations to Increase Private Sector Enrollments

Deren Temel | M.S. Ed | University of Pennsylvania | 2016

Abstract: This brief provides recommendations to assist Vietnam’s Ministry of Education and Training reach its goal of 40% private sector enrollment. This brief begins by explaining Vietnam’s rationale for expanding higher education enrollment. It explores the historical context of Vietnamese higher education policy, discusses the results of past reforms and notes how academic quality, financial stability, and low reputation hinders private sector enrollment. It concludes with recommendations that encourage the government to view private sector students as higher education consumers in need of quality assurances, financial stability, and a strong reputation before they can confidently enroll in the private sector.

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List of Acronyms

APQAN Asia Pacific Quality Assurance Network ASEAN Association of Southeast Asian Nations AUN ASEAN University Network GDETA General Department of Education Testing and Accreditation

GER Gross Enrollment Rate HE Higher Education HEI Higher Education Institute HERA Higher Education Reform Agenda MOET Ministry of Education and Training PBHEI Public Higher Education Institutes PVHEI Private Higher Education Institutes

Table of Contents

Introduction 1

Motivations for Expanding Higher Education 1

Higher Education Reform 5

Past and Present 5 The Higher Education Reform Agenda 6 Growth and Growing Pains 7 Private Higher Education in Vietnam 8

Recommendations 11 Conclusion 12

References 13

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Introduction | Expanding Private Sector Higher Education in Vietnam Vietnam’s higher education (HE) system must expand enrollment capacity to meet its youth population’s demand for economically relevant skills and training. The Vietnamese Ministry of Education and Training’s (MOET) Higher Education Reform Agenda (HERA) codified the need for enrollment expansion by aiming to expand Vietnam’s gross enrollment rate (GER), the percentage of adults between age 18 and 22 enrolled in higher education, to 45% by 2020 (Nghi, 2010). With Vietnam’s GER reaching 30% in 2014, the Vietnamese government can no longer financially afford to enroll the majority of students within state-owned higher education institutes (World Bank, 2016a). To address the public sector’s financial limitations, the HERA aims to shift 40% of all HE enrollments to private higher education institutes (PVHEI) by 2020 (Nghi, 2010). The HERA’s private sector enrollment goal is both a strategy for expanding enrollment and a cost shifting strategy from the public sector to the private sector. After legalizing the HE private sector in 1998, private sector enrollment grew to 15% in the fourteen years to 2012 (Clark, 2014). Without implementing reforms to improve PVHEI’s accreditation, financial stability, and market responsiveness, Vietnam’s private sector is unlikely to reach HERA’s 40% enrollment goal.

The following brief offers recommendations for the MOET to reach their 40% private enrollment goal within a reasonable time period. The recommendations are exist within the context of Vietnam’s recent history of higher education marketization. This brief explores Vietnam’s rationale for higher education expansion, explains the legal evolution of marketization in the higher education, illustrates the enrollment growth since marketization, discusses the challenges faced by the private sector, and provides recommendations to improve the private sector’s perceived academic, financial, and societal reputation to would-be students. Without reforms the private sector will continue to be unattractive to would-be students. Vietnam will not be able to accomplish HERA’s vision of expanding private sector enrollment without making the private sector an attractive investment for students.

Motivations for Expanding Higher Education

Improving economic, political, social welfare, international reputation, and demographic factors is the main impetus for expanding HE in Vietnam. Higher education trains a skilled and efficient labor force, which can increase gross domestic product (Brennan, 2013). Vietnam’s role as a manufacturing outsourcing destination presents Vietnam with a need for skilled labor to manage the factories, execute international business, and operate industrial logistics. This requires a labor force proficient in market-oriented skills such as business administration, communications, and technological know-how. Politically, the Vietnamese government benefits from higher education’s impact on fostering social cohesion, lowering unemployment, and propagates their political ideology through the mandated 14% of curriculum dedicated to Marxist Thought in all public and private higher education institutes (HEIs) (St. George, 2010). Spreading the social welfare benefits of higher education legitimizes the government’s authority by improving quality of life, poverty alleviation, health awareness, and educational marginalization (Brennan, 2013). The expansion of higher education also creates an avenue for soft power through international recognition and the soft power pull of Vietnamese universities on Cambodian and Laotian international students.

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Motivations for Expanding Higher Education | Demography

Demography acts as a push factor for the expansion of Vietnamese higher education. Vietnam experienced a “baby-boom” in the post-war reform era. The population has grown from roughly 50 million in 1975 to roughly 94 million by 2015 (CIA, 2016). Observing Figures 1 and 2 we see that by 2000 the “boomers” reached their teen years, and by 2014 they had matured into the higher education enrollment age (18-22). 2012’s HEI admissions experience illustrates the challenge perfectly: 1.3 million students competed for 600,000 spots in Vietnam’s entire HEI system-- in other words, enrollment demand was more than twice the total capacity (Clark, 2014). There is significant unrealized potential in the labor force and unmet demand for Vietnamese HE.

Population 2000 | Population 2014

Motivations for Expanding Higher Education

Since 1993, the MOET has emphasized higher education as a means to national development (St. George, 2010). The goal of national development and expansion of HE are interwoven with motivations of economic necessity, political legitimacy, social welfare, and international prestige. The cost of educating Vietnam’s youth population is too great for the Vietnamese government’s budget. Since 1998, the government legalized the private sector HEIs as a cost shifting strategy to help bridge students’ demand for HE capacity and the nation’s modernization goals (Hayden, 2010a). The private sector in Vietnam balances between a national commitment to socialism and frenzied growth in the market economy. It stands between a central government that encourages the private sector to provide capacity, and simultaneously, “forbids all actions that commercialize education” (St. George, 2010, p. 46). The on-going interplay between central authority and marketization shapes Vietnam’s HE system historically and continues to present challenges for today’s private sector.

Figure 1. Vietnam Population 2000 (CIA, 2016) Figure 2. Vietnam Population 2014 (CIA, 2016)

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Higher Education Reform | Past and Present

The history of higher education in Vietnam began in 1070 with the establishment of the imperial academy in Ha Noi. Ancient Vietnamese HE employed the rote memorization of Confucian teachings in preparation for a magisterial exam system (Tran L., 2014). For centuries HE was an avenue for the aristocracy to advance their social rank within the royal government. The current system dates back to 1904 when the French-colonial University of Indochina opened in Ha Noi (Tran, 2014). French (1880-1954), American (1954-1975), and Soviet (1945-1986) educational systems exerted a strong influence over Vietnam during the 19th and 20th centuries (Tran, 2014).

Higher Education Reform Timeline

1070 – Imperial Academy founded in Ha Noi 1904 – French establish Uni. of Indochina 1945 – Soviet influence in North Vietnam 1954 – American influence in South Vietnam 1975 – Vietnam is unified 1975 – Soviet influence in unified Vietnam 1986 – Doi Moi | transition to market economy 1986 – GER is 2%, 101 HEIs 1990 – Established the MOET 1993 – Legalized fee-paying students 1998 – Legalized Private Sector 2006 – The Higher Education Reform Agenda 2012 – Law of Higher Education of 2012 2015 – 30% GER, 425 HEIs

After unification of North and South Vietnam in 1975, the Soviet style mono-disciplinary HE system spread throughout the country. In the Soviet system, universities were focused on specific disciplines, curriculums were theoretical, enrollments figures were based on manpower forecasting, research was housed within separate research institutes, and distinct ministries governed individual higher education institutes (UNESCO, 2006). For example, the Ministry of Health governed the University of Health (St. George, 2010). The meritocratic and tuition-free Soviet system’s GER was 2% (St. George, 2010). Aligned with the ethos of the era, Marxist-Leninist coursework and two years of Russian language were compulsory (St. George, 2010). Vietnam approached the 1986 reform era with a narrowly focused, outdated, disaggregated Soviet HE system with poor infrastructure and overly theoretical curricula (UNESCO, 2006). Following the Open Door policies of China and market experiments in the Soviet Union, Vietnam’s 6th National Congress announced Doi Moi (“Rejuvenation”) in 1986 (UNESCO Bangkok, 2006). Doi Moi is not a single policy, but a government commitment toward piecemeal economic marketization. Marketization is the process by which an economy becomes market-oriented. Vietnam’s desire to transition toward a market economy would be held at bay by the government’s concern regarding the inequalities of the market system and desire to maintain control (Ziguras, 2014). The Doi Moi era challenged the government to allow the higher education system to become more market responsive, autonomous, and privatized. In 1990, Vietnam merged two government departments together to form the Ministry of Education and Training (MOET). The MOET was intended to become the supreme body of Vietnamese higher education responsible for salary setting, staffing, state funding, faculty recruitment, enrollment quotas, and total government HE expenditure (Sheridan, 2010). Over the course of the 1990s, the MOET would consolidate the mono-disciplinary Soviet universities into five diversified national universities (Clark, 2014). In 1993, the 7th National Congress signaled that education reform would be pursued as a means to national development (St. George, 2010). 1993 saw the legalization of fee-paying students at public HEIs (PBHEIs) and an increase in the state budget for HE (St. George, 2010). The legalization of tuition fees ended the strictly meritocratic public HE system and ushered in a wave of expansion, as formerly under-qualified students enrolled as tuition paying students (St. George, 2010).

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Higher Education Reform | Past and Present (cont.)

The landmark Education Law of 1998 legalized the private sector, offered tax deductions for donations toward education, and devolved some of MOET’s powers to HEIs (St. George, 2010). The legalization of the private sector in 1998, ushered in Vietnam’s fastest enrollment growth and pushed the system to expand capacity. It is important to note that in Vietnamese policy reform, investigation tends to precede legalization. The first experiments with tuition-paying students began as early as 1986 and Vietnam’s first private university was established in 1990 (St. George, 2010). These market trials began years before they were legally recognized in 1993 and 1998. Experimentation allows the government to test new strategies without upsetting the status quo. Ambiguous policies allow the MOET to pivot between seemingly contradictory positions. For example, the Education Law of 1998 legalizes the private ownership of PVHEIs, yet simultaneously, “forbids all actions that commercialize educational activities” (St. Georges, 2010 p. 46). Allowing these two contradictory forces to play out in the HE system, gives the MOET time to observe progress of policy experimentation without formally committing to either. After 1998’s legalization of the private sector, Vietnam entered into an era of globalization, rapid economic growth, and rapid increases in HEI establishment and HE enrollment. Reforms in 2000 designated research institutes, universities, and colleges as the only three components of HE (Hayden, 2010b). The Education Law of 2005 created the contemporary framework for the system the private sector (Hayden, 2010b). 2005’s Higher Education Reform Agenda painted a vision for Vietnamese HE development from 2005 to 2020.

Higher Education Reform | The Higher Education Reform Agenda

In the midst of Vietnam’s entry into the global market and the youth population’s maturation into the higher education enrollment age (18-22), the MOET orchestrated its broadest series of reforms; 2005’s Higher Education Reform Agenda (HERA). HERA is an expansive list of ambitious goals set,

To carry out fundamental and comprehensive reforms of higher education; undertake a process of profound renews in the area of the quantity, quality, and effectiveness in order to meet all the demands of industrialization, modernization, global economics, integration and society’s demand for learning opportunities. (Resolution 14/2005/NQ-CP, 2005 as cited in Nghi, 2010)

During HERA’s fifteen-year timeframe the government hopes to modernize the higher education system to follow international standards, prepare the workforce with relevant skills, and shake off the lingering remnants of the Soviet system (Nghi, 2010). The HERA’s has over forty goals concerning HE capacity, governance, funding, enrollment and many others. This brief focuses on HERA’s goal to increase the private sector’s share of total enrollment to 40% by 2020 (Nghi, 2010). Since the Doi Moi and HERA reforms, Vietnamese HE has grown remarkably.

Goal: Increase private sector enrollment to

40%

Figure 3. GER in PHEIs.

(Clark, 2014; Nghi, 2010)

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Higher Education Reform | Growth and Growing Pains

Labor market signaling, modern skills training, and a traditional Vietnamese emphasis on educational achievement motivated HE enrollment growth over the last thirty years. Since the Doi Moi reforms ended the “100% employment” policy of the Soviet HE system, students owned their human capital and sold it in the labor market for the first time (Tran H., 1999). In a labor market students can signal their skills and training to potential employers by earning a HE degree. The actual quality and perceived quality of a HEI affects the signaling potential of the HE degree. Hence, students in a market system are concerned with the perceived quality of their enrolling institution. Since the global economy created demand for business administration, communication, and technological skills, the economic necessity to learn market-oriented skills such as advertising, marketing, and business communications pulled students into higher education (Nguyen H., 2014). Furthermore, the Vietnamese people traditionally value higher education for prestige and social mobility (Tran L., 2014). In the 25 years from Doi Moi, Vietnam advanced from a low income to a lower middle-income country by 2010 (World Bank, 2016b). As a greater portion of the population could afford to pay tuition in public and private HEIs, enrollment in HE increased. Since the Doi Moi reforms, Vietnam’s GER has grown from 2% to 30% as of 2014 (World Bank, 2016a).

Examining the results of the post-Doi Moi reforms, Figures 4 and 5 demonstrate that the number of public and private HEIs doubled between 2005 and 2015. Not only did the number of HEIs double in a decade, the total number of enrolled students grew by roughly 600,000 in the same period (Do, 2014). Enrollment within the private sector quadrupled from roughly 100,000 students in 2000 to about 400,000 by 2012 (Do, 2014). Figure 7 illustrates that the total number of HE student grew from 153,035 in 1987 to 2,204,313 by 2012 (Do, 2014). We can observe that between 1987 and 2015 the number of HEIs grew only fourfold, while the total number of students grew fourteen fold over a similar period. The large gap between high demand for enrollment and the relative under supply of quality HEIs contributes to fierce enrollment competition and high student-to-teacher ratios (Hayden 2010b; Clark, 2014). Vietnam’s rapid growth confronts the entire HE system with enrollment capacity restraints and leaves the government with an ever-increasing financial obligation to fund PBHEIs. The MOET cannot continue to fund the expanding enrollment figures, hence HERA’s intention to shift costs to the private sector. Unfortunately, today’s private sector does not have the academic reputation, financial stability, or social standing to attract 40% of the Vietnam’s total GER.

Total Public Private

1987 101 101 0

1997 141 126 15

2005 230 201 29

2015 425 336 89

Figure 4. Amount of HEIs (Do, 2014; Pham, 2015)

Figure 6. Amount of HEIs (Do, 2014; Pham, 2015)

Figure 5. Vietnam GER (World Bank, 2016a)

Figure 7. Amount of HE students (Do, 2014)

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Private Higher Education in Vietnam | Persisting Challenges

The unified Socialist Republic of Vietnam outlawed private sector higher education in 1975 in accord with their socialist values. After Doi Moi, the MOET began experimenting with the private sector during the early 1990s and legalized it with the Education of Law of 1998 (Hayden, 2010a). The private sector receives no state funding, may charge tuitions 200% above MOET’s public tuition cap, and as of the Education Law of 2005 PVHEIs are permitted to redistribute their operating surplus to investors (Hayden, 2010a). The Education Law of 2012 designated PVHEIs as either for-profit or not-for-profit PVHEIs (Do, 2014). At the same time, the MOET signaled that it would support not-for-profit PVHEIs with land grants and generous tax incentives (Hayden, 2010a). Most Vietnamese private institutions operate as for-profit businesses although they claim to be not-for-profit (Do, 2014). The legal framework for the private HEIs (PVHEI) carries the characteristic contradiction of Vietnamese governance. PVHEIs are granted financial autonomy, yet the government caps their tuition fees and enrollment quotas (Hayden, 2010a).

PVHEIs face challenges in perceived quality, perceived financial instability, and poor standing with the MOET that leaves PVHEIs unattractive to would-be students. In 2013, 1/3rd of PVHEIs reported enrollment below 50% of capacity (Thong, 2015). Despite the demand for HE enrollment across Vietnam, for reasons of academic and financial quality and the high cost of tuitions, the private sector is so unattractive that some students choose not to attend. For a sector dependent on tuition fees for operating revenue, these challenges pose an existential threat to the sector. If these challenges persist the Vietnamese private sector will not meet HERA’s enrollment goal and the sector may even collapse. The most persistent challenge for PVHEIs is the low perceived quality of their programs. Vietnam’s marketization created a high demand for soft or creative skills such as marketing, advertising, sales, and communications (Nguyen H., 2014). PVHEIs offering “soft” skills degree programs require less initial investment than HEIs teaching the “hard” sciences. The private sector thrives on offering high-demand market-oriented business and communication degree programs with low initial investment, and high financial returns (Hayden, 2010a). Since these programs are not academically intensive the private sector tends to enroll students of lower academic standing and can afford the private sector’s expensive tuition fees (Hayden, 2010a). PVHEIs absorb the excess demand from PBHEIs and this contributes to the notion that PVHEIs are “garbage-can universities” (Hayden, 2010a p. 218). PVHEIs’ low perceived quality deters students from enrolling in the private sector. Accreditation could improve the private sector’s low perceived academic quality. Accreditation is the process of an independent agency conducting an academic quality review of a HEI and the HEI’s specific degree programs. Earning accreditation acts as a form of quality assurance that provides consumer knowledge about the quality of the accredited HEIs to would-be students. In the absence of reliable consumer knowledge Vietnam’s PVHEIs retain the stigma of low perceived academic quality. In 2003, the MOET established the General Department of Education Testing and Accreditation (GDETA) to develop an accreditation system. GDETA’s accreditation system was designed through international donor lead projects (Do, 2014). GDETA accreditation is mandatory for all public and private HEIs (Austrade, 2014). GDETA’s accreditation framework is a three-stage process: self-evaluation, external evaluation, and third-party external evaluation appraisal. Starting in 2005, GDETA trained Vietnamese HEIs to independently conduct self-evaluations. Between 2013 and 2015, three state-owned national accreditation agencies were established within Vietnam National University’s Ho Chi Minh City, Ha Noi, and Da Nang branches (Nguyen, Q., 2016). In January 2016, 553 public and private HEIs submitted self-evaluations to a national accreditation agency (Nguyen, Q., 2016). However, as of March 2016 only 60 HEIs have undergone the external evaluation stage (Nguyen, Q., 2016).

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Private Higher Education in Vietnam | Persisting Challenges (cont.)

GDETA proposes to complete the accreditation process within five-year cycles (Austrade, 2014). Due to limited funds from the MOET the three national accreditation agencies are persistently behind schedule (Austrade, 2014). The five-year accreditation-processing period leaves new PVHEIs or currently unaccredited PVHEIs to operate without accreditation and hence low perceived quality. To increase the supply of accrediting agencies and subsequently hasten the pace of accreditation, Vietnam aims to allow private accreditation agencies to operate by 2016 at the earliest (Thanh, 2013). As of May 2016 private accreditation agencies do not legally operate in Vietnam. Not only does accreditation approval provide consumer knowledge to would-be students, but it also can benefit student’s ability to transfer between Vietnamese HEIs and HEIs in the Association of Southeast Asian Nations (ASEAN).

Vietnam’s entire HE system grapples with perceived low quality amongst its ASEAN neighbors. Vietnam’s GDETA joined UNESCO’s Asia Pacific Quality Assurance Network (APQAN) and ASEAN’s Asian University Network (AUN) (Thanh, 2013; Nguyen, Q., 2016). APQAN and AUN aim to integrate HE quality standards across the ASEAN region to increase student and labor force mobility (Yaogang, 2016). The potential to attract regional students and integrate Vietnamese graduates into the regional labor force likely motivated Vietnam to participate in the APQAN. Currently, Vietnam’s accreditation criteria are focused on academic and financial capital inputs, rather than APQAN and AUN’s student outcomes focused framework (Do, 2014). Vietnamese accreditation would have to match APQAN and AUN’s outcomes-based criteria before Vietnamese degrees are perceived as equivalent to degrees in earned in other ASEAN states (Do, 2014; Nguyen, Q., 2016). Vietnam aims to follow regional guidelines by 2018 (Austrade, 2014).

Widespread accreditation in the private sector creates a barrier to entry for low quality PVHEIs and would maintain a quality threshold for operating PVHEIs. This barrier and threshold would filter out the low quality PVHEIs. With the low quality PVHEIs forced out of the sector, the actual and perceived quality of the private sector could greatly improve. Likewise, accreditation with regional agencies would boost the sector's reputation both domestically and internationally. However, until the aforementioned quality assurance challenges are addressed Vietnam’s PVHEI will continue to endure the stigma of low perceived quality.

The private sector also confronts the challenge of low perceived financial stability. In the market-oriented society, Vietnamese students and their families view HE a financial investment in skills, training, and increased human capital. The PVHEI must be seen as financially stable in order for students to feel enrolling in a PVHEI is a safe investment. Students enrolled in PVHEIs are particularly cautious about their PVHEIs operating for the entire duration of their study, maintaining the signaling quality of their degree by remaining open in the future, and what financial costs they will face if their PVHEI goes bankrupt. To address these concerns, in 2005 MOET decided that PVHEI founders must be able to invest US $950,000 in registered capital toward their PVHEIs (Hayden, 2010a). The decree has not solved the issue of financially weak PVHEIs because the initial investment does not offer security for a PVHEI’s long-term sustainability. The bankruptcy of financially unstable PVHEIs perpetuates the private sector’s low perceived financial stability (Thong, 2015). The Vietnamese private sector does not have a form of PVHEI bankruptcy protection akin to endowments that would give customers a sense of financial security when enrolling.

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Private Higher Education in Vietnam | Persisting Challenges (cont.)

Although the MOET set a target to expand private sector enrollment, the MOET’s derogatory regulations for the private sector deters students from enrolling in PVHEIs. MOET’s suspicion that the private sector would devolve into “degree mills”, inspired the MOET to charge fines for over-enrollment, cap tuition fees, set an entry examination score “floor” which forbids low performing high school students from enrolling in PVHEIs, forbid the private sector from offering graduate degrees, and restrict a wide range of public graduate programs from students who earned their undergraduate degree from a PVHEI (Do, 2014; Hayden, 2010a). The aforementioned regulations, particularly the score “floor” demonstrates that the MOET views the private sector as a profiteering industry that preys on unqualified students and does not prepare them for further academic study. Likewise, restricting a wide range of public graduate programs from PVHEI graduates contradicts the Education Law of 2005’s proclamation that degrees earned in the public and private sectors are academically and socially equivalent (Hayden, 2010a). Although MOET enacted these controversial policies to prevent opportunistic profiteering, MOET’s suspicion undermines the notion the private sector offers a quality education that can act as an avenue for social mobility. This conundrum deters students from enrolling in the private sector.

In its current state the private sector is unattractive to students due to academic, financial, and reputation-centered issues. HERA’s aim to scale up enrollment in the private sector risks exacerbating the issues faced by the private sector and undermining the education of students enrolled in PVHEIs. The quality shortcomings of the private sector could damage the reputation and perceived quality of the entire Vietnamese HE system. In order for Vietnam to avoid this fate, the MOET should consider the following recommendations to improve perceived and actual academic quality, assure financial stability, and remedy the private sector’s poor social standing.

Private Higher Sector Analysis Chart

Strengths Challenges

§ Tuition Financed Sector

§ Demand Absorbing Programs

§ Market responsive

§ Market-Oriented skills training

§ Non-Selective

§ Sector Growth Potential

§ Low Academic Quality

§ Financial Instabilty

§ Low Standards

§ Accredition Issues

§ Expensive Tuitions

§ Loan dependent

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2: Open a National Private Sector Accreditation Agencies

In order to address the issue of slow accreditation, I recommend that the Vietnamese government open a private sector specific branch of the GDETA within the three existing national accreditation centers. This branch of the GDETA will be fee generating. This agency will be financially independent from the MOET. It will operate much like a private agency, however it will have the academic and legal support of the MOET. This agency could hasten private accreditation without penalizing or slowing accreditation of the PBHEIs.

3: Encourage Regional Accreditation for PVHEIs

In order to address the issue of low perceived quality, I recommend that academically strong PVHEIs apply for ASEAN regional accreditation certification. Vietnam has 19 universities accredited with the AUN and none of them are private (Nguyen, 2016). AUN and ASEAN accreditation certificates offer a low cost path to accreditation. Realistically, few PVHEIs will have sufficient quality to meet regional standards, but the opportunity should be encourage for PBHEIs that aspire for regional accreditation. The MOET can encourage regional accreditation by subsidizing accreditation fees and advising would-be private sector applicants. If Vietnamese PVHEIs could earn regional accreditation it could improve perceived quality both domestically and regionally.

The following five recommendations aim to strengthen the academic, financial, and reputation of Vietnam’s PVHEIs. If the Vietnamese government seriously intends to shift 40% of enrollment to the private sector, it must view the private sector as a partner in Vietnam’s higher educational development and be willing to invest in the private sector. Investment in the quality of the private sector will benefit the would-be higher PVHEI students. The recommendations are presented in the order they were discussed in the brief. Recommendation 4 is the most strategic and feasible.

1: Allow Private Accreditation Agencies

In order to address the issue of slow accreditation, I recommend that the Vietnamese government legalize private accreditation agencies. The private agencies will evaluate public and private HEIs along the GDETA’s accreditation criteria. The GDETA must oversee the private agencies’ financial transparency, accreditation criteria, and ethical business practices. The private agencies will charge fees to PVHEIs for their accreditation services and reduce the MOET’s financial burden to fund accreditation. Private agencies will also be sector specific and diversify accreditations services. For example a business school accreditation agency can specialize in accrediting business programs. The increased supply and diversity of specializations will hasten accreditation within Vietnam. PVHEIs will benefit from faster accreditation from a competitive private accreditation market.

Recommendations

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4: Mandate PVHEIs Establish Financial Stability Trust Funds

In order to address the issue of financial instability of PVHEIs, I recommend that in addition to the requirement to demonstrate US $950,000 in registered capital that new PVHEIs be required to transfer a comparable large amount of money into a specific MOET operated Financial Stability Trust Fund (FSTF) for each PVHEI. The FSTF money would be used for the sole purpose of reimbursing or relocating the PVHEI’s students in the case of bankruptcy. The size of the FSTF should correspond to the total tuition costs of the PVHEI’s intended enrollment numbers. The FSTF’s amount should be published regularly to promote transparency. A trust fund is recommended in order to prevent the PVHEIs from using those funds improperly or being taxed on it as an asset. The sense of financial security that would-be students would feel with a FSTF is comparable to the financial security that bank depositors experience with government backed deposit insurance. Financing an FSTF would likewise construct a barrier to entry for financially weak would-be PVHEIs. This barrier would eliminate financially weak PVHEIs and improve the perceived financial stability of the private sector.

5: End MOET’s Derogatory Treatment of PVHEIs

In order to address the issue of PVHEIs’ low reputation, I recommend that the MOET end its derogatory regulations against PVHEIs. Public graduate program admissions should be open and meritocratic, and include graduates from PVHEIs. This does not mean that program pre-requisites should be eliminated, but that overt academic discrimination should end. I also recommend PVHEIs that receive the highest level of accreditation, on par with the PBHEIs, should be allowed to offer graduate programs. PVHEIs should have the ability to increase their reputation by offering advanced degrees. This recommendation is contingent on a fair accreditation system in Vietnam.

The challenges faced by the private sector are symptomatic of a higher education system that is experiencing marketization. Unlike in Vietnam’s Soviet system, where students were educated in order to serve the needs of Vietnam’s political, economic, and social structures, marketization has gradually forced the Vietnamese government to reform its political, economic, and social structures to serve the students’ needs. In the market economy, consumer knowledge is crucial. HERA’s private sector enrollment goal is akin to converting 40% of Vietnam’s HE students into HE consumers. The recommendations posed in this brief encourage the government to view private sector students as consumers in need of quality assurances, financial security, and reputable social standing before they will invest in their own education.

Conclusion

Deren Temel M.S.Ed | IEDP 2016 University of Pennsylvania temel@gse.upenn.edu https://www.linkedin.com/in/derentemel

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