Higher education as an industry

Heriot-Watt University Malaysia is one 10 international branch campuses in the country.

EDUCATION is the most powerful weapon which you can use to change the world – Nelson Mandela.

Education is the one pillar that cannot be absent in nation building. It is, to many, the most important foundation in a country’s social and economic development. Thus, with all these importance and virtues, can it be viewed as an industry?

In Malaysia, the education sector has come a long way since the first school, Penang Free School, was built in 1816 to provide formal education. After gaining independence, the government set up government-owned schools to provide education to its citizens. The establishment of Universiti Malaya in 1962 acted as a catalyst for decades of education excellence. It is realised that the early years after independence only government schools and universities were torchbearers with the responsibility to provide education to the people.

However, the eighties saw the beginning of private higher education as public universities were only able to provide access to about 14% of youth between the ages of 17 to 23. As a result, a number of private colleges started to offer Diploma and Certificate programmes by established universities from the United Kingdom, Australia and the United States to Malaysian shores. Students were to spend two years in Malaysia and the rest in the main campus abroad.

When Malaysia was struck by an economic downturn in the late eighties, the government facilitated the private colleges by allowing the programmes to be completed in Malaysia. This gave birth to the term transnational higher education.

Ever since then, higher education in Malaysia has grown in quality and quantity, providing education not only to Malaysians but also to international students. From having only government-owned universities to having more international renowned universities offering twinning programmes with private universities in Malaysia. Some universities even have their own branch campus in Malaysia, for example Monash University Malaysia, Curtin University Malaysia, University of Southampton Malaysia and Xiamen University Malaysia. To date, there are 10 international branch campuses in Malaysia.

The education sector in Malaysia is fast in fulfilling the definition of not only an industry, but also an almighty successful one. Local and international investors have increased in joining this successful industry where purportedly, there exist no recession. These investments are not only in terms of physical academic facilities, but also in terms of research and talent development.

Although some may argue that we cannot put a price on knowledge or education, we cannot deny the fact that the education sector, especially private education, is contributing to the country’s economic growth.

A report by the Department of Statistics Malaysia showed that contribution of Gross Domestic Products from private education has steadily increased since 2015 to 2018 by RM14.09bil, RM14.84bil, RM15.70bil and RM16.62bil respectively. This is a growth of value of roughly 7.7% annually. The private higher education institutions, however, claimed that the figure could go up to RM30bil by taking into consideration the investment on infrastructure and infostructure.

The Education Ministry is the biggest recipient in the 2019 Budget with an allocation of RM60.2bil, which is 19.1% of total government spending. In line with the Quadruple Helix model applied in the education sector, this allocation is for physical infrastructure, teaching and learning, research and also the community. The research and development budget has also increased from RM345mil in 2018 to RM455.35mil in 2019.

It is then, categorically right to claim that Malaysia is now a well-known and trusted education hub globally. Malaysia’s higher education has transformed from importing higher education to exporting higher education. This is not a surprising fact as we are now not only hosting 10 international branch campuses, but we are also ‘exporting’ education through franchising Malaysian academic programmes abroad via twinning programmes and joint award with international universities. The influx of foreign students coming to study in Malaysia’s public and private higher learning institutions marks a positive evolution in Malaysian education sector.

As of 2019, a total of 173 thousand international students have been recorded to be studying in Malaysia. These students are spending an average of RM30, 000 a year on tuition fees and accommodation. The higher education sector is also estimated to be contributing at least RM17bil per year to the country’s economy. This is without taking into consideration the multiplier effects on the economy of the community. Higher education in Malaysia has certainly transformed to become a significant industry as it checks in every box:

i. It is a systematic investment from the students and guardians or parents;

ii. It contributes to the technological capability and technical enhancement;

iii. It contributes to the growth of research and innovative findings and output;

iv. It acts as a mechanism in fulfilling market labour force where institutions provide training and upskilling as finishing schools; and

v. It contributes to the socio-economy of the community and also to the country’s GDP.

Benjamin Franklin once said: “An investment in knowledge pays the best interest.” Hence, looking at the positive progress that the private higher learning institutions are making, should we now lift the moratorium to allow healthy competition?

Some believe we should but on the same note, we have to take precautionary measures as we would never want to jeopardise the most important pillar in nation building simply for quantity based commercial reasons. All growth is good but unmonitored ones will make us pay dearly in the future.

DATIN PADUKA DR SITI HAMISAH TAPSIR

Director-General

Higher Education Department