Vietnam spends big on education to boost economic growth

Graduates of Ernst Thälmann High School in Ho Chi Minh City Vietnam spent an average 4.9 per cent of its gross domestic product (GDP) or 18 per cent of the state budget annually on education in the period between 2011 and 2020, the Vietnam National Institute of Educational Sciences stated in a new report. The spending in state budget terms is higher than in many regional countries, for example Thailand (14.9 per cent), Indonesia (17.5 per cent) or Malaysia (17.7 per cent). As percentage of GDP, Vietnam spends 4.9 per cent for education, which is also…

Vietnam spent an average 4.9 per cent of its gross domestic product (GDP) or 18 per cent of the state budget annually on education in the period between 2011 and 2020, the Vietnam National Institute of Educational Sciences stated in a new report.

The spending in state budget terms is higher than in many regional countries, for example Thailand (14.9 per cent), Indonesia (17.5 per cent) or Malaysia (17.7 per cent). As percentage of GDP, Vietnam spends 4.9 per cent for education, which is also higher than most other regional peers, including Singapore (2.9 per cent).

The heavy spending in well educated people is in line with recommendations by the World Bank which in a recent report said that Vietnam will need a skilled workforce to transform itself into an upper-middle-income economy by 2035.

Skilled workers needed to transform economy

In its bi-annual report “Taking Stock: Educate to Grow” released earlier in August, the global development bank said that “Vietnam needs a workforce with 21^st century-skills to grow. As the economy moves from being driven by low-skill and low-wage jobs in manufacturing and services towards a more innovation driven growth model built on higher value-added industries and services, Vietnam’s workforce will need to attain higher level and more relevant skills.”

The Vietnamese Government’s Socio-economic Development Strategy for 2021-2030 reflects this, saying it aims to use “scientific, technological, innovative and digitally transformative knowledge and build quality human resources as key drivers of higher productivity and future economic growth.”

To achieve these goals, Vietnam needs to reform its education system to improve quality and access, and thus provide the necessary skills to the population, it affirmed.

According to Le Anh Vinh, head of the Vietnam National Institute of Educational Sciences, the government has set a target of spending 20 per cent of its budget on education.