Private education investors: Consequences of 'billion-dollar shocks'

The picture of Vietnamese education has become more vibrant, with more learning opportunities for people when private investors participate. However, the recent 'shocks' have not only disappointed learners but also had a big impact on investors.

If the management agency does not have clear and transparent policies, it will easily discourage those who are passionate about investing in education .

A I PROTECT THE RIGHTS OF VICTIMS?

The occurrence of "billion-dollar shocks" such as the incidents related to the Apax Leaders system, the American International School (AISVN), Green Shoots International School, the Hanoi Star Education System... makes many people wonder who will protect the victims. Students are suspended from school, parents lose money, investors are in trouble..., but when will their rights be protected?

The Apax Leaders system has caused long-lasting consequences in education that have not ended yet.

PHOTO: VU DOAN

A parent whose child studies at AISVN shared bitterly with Thanh Nien reporter: "I lost sleep many nights because I didn't know where the exit was. Desperate! I don't know where that money goes?".

Despair is also the common sentiment of parents whose children study at Apax Leaders English Center. A chat group of victims alone has had nearly 800 participants since the incident occurred and they share information every day. All are still in a state of despair, because the tuition fees they have spent will almost never be recovered.

The leader of EQuest Group (the owner of member companies Viet My K-12 Education Investment Joint Stock Company and Vietnam Star Education Joint Stock Company) also bitterly exclaimed that "trust was stolen" when involved in disputes and lawsuits with Ms. Ng. (one of the founding shareholders, partner transferring Hanoi Star Education System to EQuest Education Group). This leader said that although he had completed the investment of more than 1,000 billion VND to own 80% of the ownership and operation rights of Hanoi Star Education System, the cooperation was stopped and the school was not handed over. The company's leader had to send a complaint to the Department of Investigation Police on Corruption, Economic Crimes , and Smuggling (PC03) - Hanoi City Police.

IMPACT ON EDUCATIONAL INVESTMENT

According to many experts, the continuous occurrence of incidents in private education investment has affected the reputation of this system. Many legitimate businesses are facing huge consequences from "a few bad apples spoiling the barrel", leading to hindering the overall development.

According to lawyer Truong Thanh Duc, Director of ANVI Law Firm, a transparent business investment environment is an important institution that any country that wants to attract FDI capital must start building as soon as possible. "For the education sector, a field with large investment levels, long-term duration, and low profit margins, not creating a healthy and stable business environment not only makes it difficult to attract capital but also leads to consequences such as parents and students losing faith in education and the value of learning, affecting their motivation to learn and develop themselves; affecting the psychology and ethics of those participating in and receiving education; reducing the quality of future human resources and reducing the attractiveness of the market, hindering investment capital flows, especially international investment," lawyer Duc shared.

Meanwhile, the Vietnamese education market, with the advantage of a young population and a growing desire to learn, is considered a fertile land for investors. In the context of the world facing rapid and complex economic, social and political changes, countries are forced to readjust their policies to attract foreign direct investment (FDI). Compared to economies in the region and continent, Vietnam has certain advantages, such as: economic growth rate is recovering and stabilizing after the Covid-19 pandemic, effective open-door policies and economic reforms, a stable political system, an abundant labor force, relatively cheap labor costs, open investment attraction policies, etc. These are clearly attractive factors that have helped FDI capital flows into Vietnam increase steadily in recent times.

At many national forums and seminars, FDI investors and experts also acknowledged the efforts of the Vietnamese Government in reforming and perfecting institutions, removing barriers in business and investment, creating an open, transparent and friendly environment for foreign investors. In addition, the Government and ministries have issued, supplemented and amended a number of regulations to remove difficulties, support businesses to operate more effectively as well as improve the investment environment, enhance national competitiveness, thereby increasing the attraction of FDI investors.

American International School Vietnam (AISVN) has caused serious consequences for parents and students by collecting tuition fees under the guise of "huge" investment packages.

PHOTO: BT

However, the FDI capital flow into the education sector, despite significant progress compared to the previous period, has not really satisfied the industry's "thirst" for investment. In fact, compared to other countries in the region, Vietnam's FDI capital flow into education is still quite modest. According to World Bank data, in 2023, Singapore's total FDI capital into education will reach 12 billion USD, Malaysia's 8 billion USD, Thailand's 5 billion USD, while Vietnam's will only reach 4.8 billion USD.

"A competitive environment lacking transparency and safety will cause a series of consequences such as: creating unhealthy competition, reducing the confidence of investors and consumers, reducing the overall reputation of Vietnamese enterprises in the eyes of international friends, negatively affecting society, hindering the sustainable development of enterprises and the economy, causing serious damage to the reputation and image of enterprises...", Dr. Nguyen Hoang Le, Director of the Institute of Human Resources and Business Development, University of Economics, Ho Chi Minh City, commented.

Raised billions and then went bankrupt

The Apax Leaders system of Egroup Education Corporation once had a system of 130 English teaching centers in provinces and cities across the country with tens of thousands of students studying. However, in 2023, many investors accused Mr. Nguyen Ngoc Thuy of fraud and appropriation of assets through the transfer of shares of Egroup Education Corporation. In addition to this act, also in 2023, Ho Chi Minh City Police investigated hundreds of complaints from parents, claiming that Apax Leaders English Corporation "appropriated tuition fees" of about 6 billion VND.

In September 2023, the scandal at AISVN caused serious consequences for parents and students. Tuition fees under the guise of "huge" investment packages have been the method that this school has applied for many years. Parents pay in advance from 3 to 5 billion VND depending on the program, students will study for free and upon completion will be refunded 100% of the amount paid. At one point, AISVN recorded more than 50% of the school's parents participating in educational investment packages. Everything only broke out when AISVN lost its liquidity. At this time, the amount of money mobilized from parents of this educational institution reached more than 3,600 billion VND.

In August 2023, Green Shoots International School in Da Nang City suddenly announced its closure right before the new school year. According to many parents, they had paid "education investment" packages for their children with a total amount of more than 14 billion VND. However, the school suddenly stopped operating, and the foreign school owner left Vietnam.

Recently, the incident involving Viet My K-12 Company and Ms. Ng. - founding shareholder of Hanoi Star Education System - is also causing discussion among education investors.

Billion-dollar "shocks" have occurred recently. The disappointment of parents and students in these stories is huge. Many investors also feel "hesitant" before the educational environment. That is an unwanted consequence when educational scandals occur.

Source: https://thanhnien.vn/nha-dau-tu-giao-duc-tu-nhan-he-luy-tu-nhung-cu-soc-tien-ti-185250924204417466.htm