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Saudi Arabia: The next hotspot for private education investors?

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.

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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.

 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%.

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%.

Read the full article on https://www.relocatemagazine.com/.

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