Saudi Arabia: The next hotspot for private education investors?
Ahead of the International and Private Schools Education Forum (IPSEF) London next week, we take a look at a special report by L.E.K Consulting and discover why Saudi Arabia could be the next big thing for private investors.
5 November 2018
Private education in the Middle East has been seen as a solid opportunity for investors since the early 2000’s. Growth in the region has been impressive, with figures from global management consulting firm, L.E.K Consulting, showing that private K-12 education in the region has grown three times faster than GDP in the past three years alone. Ahead of IPSEF London, we take a look at the opportunities in Saudi Arabia.With governments in the Middle East prioritising education, regulatory environments are increasingly favourable to private education growth. In Saudi Arabia, whose regulatory framework prohibited full foreign ownership, everything is set to change in 2019.
Take a look at education in the Middle East and around the world in the latest edition of our Guide to International Education & Schools.
With the government’s reforms under its 'Vision 2030' programme, constraints are to be relaxed. This will pave the way for global private K-12 providers and is likely to encourage a boom in private school development.
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This increase will come from local demand rather than expatriates – between 2015 and 2018, local enrolment in private international schools grew from 33% to 39% and, despite the economic slowdown, enrolment in premium international schools grew by 4%.The country has remained untouched by large global K-12 education providers. Whilst the UAE has benefited from the entry of many large global chains into the marketplace (such as Nord Anglia), Saudi Arabia is still somewhat of a blank canvas. However, large regional operators have been seizing the opportunity, many branching out from local schools.Whilst the report warns of the complex regulatory environment in Saudi Arabia, a growing student population and local demand for high-quality international education means that a relatively untapped market could pay dividends for investors poised to take advantage of the opportunities.
Read the full report, The Private K-12 Opportunity in the Middle East at LEK.com
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The education landscape in Saudi Arabia
According to the report, The Private K-12 Opportunity in the Middle East, Saudi Arabia has the largest school-age population in the region by far – 6.7 million students (compared to 3.1 million in the rest of the Gulf combined). L.E.K Consulting expect the student population in Saudi Arabia to increase to 7.6 million by 2030.However, the proportion of the population enrolled in private school education is relatively low compared to other countries in the region.“In Saudi Arabia, it is still only 16%, compared to regional peers such as Kuwait (40%) and the UAE (75%). However, Saudi’s private K-12 segment is a c. $3bn market and tailwinds are strong,” says the report.The impact of Vision 2030
In Saudi Arabia’s ‘Vision 2030’ – the Crown Prince’s reform programme which sets out the country’s long term goals – one of the aims is to increase the share of private education to 25%.Related news:
This increase will come from local demand rather than expatriates – between 2015 and 2018, local enrolment in private international schools grew from 33% to 39% and, despite the economic slowdown, enrolment in premium international schools grew by 4%.The country has remained untouched by large global K-12 education providers. Whilst the UAE has benefited from the entry of many large global chains into the marketplace (such as Nord Anglia), Saudi Arabia is still somewhat of a blank canvas. However, large regional operators have been seizing the opportunity, many branching out from local schools.Whilst the report warns of the complex regulatory environment in Saudi Arabia, a growing student population and local demand for high-quality international education means that a relatively untapped market could pay dividends for investors poised to take advantage of the opportunities.
Read the full report, The Private K-12 Opportunity in the Middle East at LEK.com
About IPSEF London
Tickets for IPSEF’s special one-day event in London on 15 November are just £250+VAT. Sessions will explore the growth of the international schools market and future trends in Europe, the Middle East and Asia. A talk by L.E.K Consulting’s Ashwin Assomull will look at the growth of international schools abroad.Other sessions will look at setting up a new school overseas, assessment, marketing and staffing.Expert speakers from international schools, legal firms, investment firms, the Department for International Trade plus research specialists and education consultants will guide you through this dynamic marketplace.As IPSEF media sponsors, Relocate Global will be providing full coverage of the event.IPSEF London kicks off on Thursday 15 September. For more information on the day and a preview of the full programme, visit: https://ipsef.net/london/overviewFor more education and school related news, visit our Education and Schools pages.Access hundreds of global services and suppliers in our Online Directory
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