By Nick Clark, Editor, World Education News & Reviews
Vietnam is currently one of the fastest growing sources of international students for U.S. institutions of higher education, according to data  from the Institute for International Education. In academic year 2011/12, Vietnam was the eighth largest sender  of tertiary students to the United States, behind Japan in 7th and ahead of Mexico in 9th. Since the turn of the century, numbers have jumped from just over 2,000 students to more than 15,500 in 2012 – or by 675 percent – with especially significant increases in the years between 2005 and 2010.
While the pace of enrollment growth has slowed somewhat since 2010, a number of factors suggest that Vietnam will continue to be an important market for institutions looking to diversify their international student body. The primary drivers compelling Vietnamese students to look overseas for tertiary education are under-capacity and generally poor standards in domestic provision, and an economy that saw impressive growth, driven by low-cost manufacturing, prior to the global economic slowdown.
Vietnam’s GDP growth has slowed considerably in recent years (as has the rate of growth in overseas enrollments) but given the country’s low-wage manufacturing environment (almost a third of that in China), a rebounding global economy is likely to lead to increased foreign investment, increased GDP growth and potentially a reinvigorated national appetite for international study.
With the societal premium that is placed on education in Vietnam, a growing economy means a widening section of the population is willing (and able) to afford an international education. It is currently estimated that 90 percent of Vietnamese students internationally are self-funded, ten times more than was the case at the turn of the century. For these reasons – among others – the Research and Advisory Services  arm of World Education Services identified Vietnam in an October 2012 report  as one of four key emerging markets for international student recruitment.
According to government figures, some 106,000 Vietnamese students were studying in 49 foreign countries and territories in 2012, up from 98,500 in 2011, with an estimated 35,900 studying in Asia and approximately 38,000, or 36 percent, studying in the two most popular overseas destinations – the United States and Australia.
The most popular Asian study destinations are Singapore, China and Taiwan. According to the China Scholarship Council , there were over 13,500 Vietnamese students in China in 2011. An estimated 7,000 were in Singapore and close to 4,000 were in Taiwan. For Taiwanese institutions of education, Vietnam has become the single largest source of international students, attracted in part by 500 Vietnamese government scholarships and approximately 100 scholarships from Taiwan.
Australia is the top destination for Vietnamese worldwide, despite recent enrollment declines. In 2012, the nation’s institutions of education hosted 22,551 Vietnamese students, which is a significant drop from the almost 26,000 students who were in Australia in 2010, but still way higher than the 10,387 students enrolled in 2007. Current visa statistics suggest that Vietnamese numbers are set to rebound, with March data showing student visa applications up 36 percent and grants up 56 percent versus the same time last year.
The United Kingdom is the fifth most popular destination, seeing an 18 percent increase in enrollments in 2010/11 (the last year for which figures are available) to approximately 5,000 students.
Vietnamese Students in the United States
Of the 15,572 Vietnamese students in the United States last year, 11,244 were studying at the undergraduate level (ranked sixth among all sending nations), with just 2,649 enrolled at the graduate level. Perhaps more significantly, of the 87,997 international students enrolled at America’s community colleges in 2011/12, 8.7 percent (7,655) were Vietnamese. This means that approximately 49 percent of all Vietnamese tertiary-level students in the United States last year were enrolled at a community college, making them the third-ranked nationality at U.S. two–year colleges behind just China and South Korea.
It should be noted here that 2012 community college enrollment data represent a significant drop from 2011 when close to 9,000, or 60 percent of the national body was studying at that level. Given that community colleges are a popular avenue to a four-year degree among Vietnamese students, there is a good chance that undergraduate enrollments at U.S. universities will tail off slightly over the next two to three years.
Across all levels, there are currently 19,541 students from Vietnam in the United States, up from 18,537 (up 5.4%) at the same time last year, according to the most recent data (March 31, 2013) from the Immigration and Customs Enforcement’s Student and Exchange Visitor System  (SEVIS).
With regards to field of study, Vietnamese students are strongly concentrated in the field of business and management, and much more so than the other 24 top sources of international students to the United States (39 percent versus an overall average of under 22 percent of international students). A further 17 percent are enrolled in engineering or math/computer science programs.
Although the most recent data from the Institute for International Education and the Department of Homeland Security show a general slowing down of enrollments from Vietnam in the short term, a number of factors seem likely to continue driving growth over the longer term.
The Appeal of a U.S. Education
Recent surveys show that a majority of Vietnamese regard U.S. higher education as the best in the world, and while income levels have not exploded to the extent that they have in China’s east coast provinces, Vietnamese students and parents continue to see education as a priority worthy of significant financial investment.
The last decade has seen strong per-capita income growth in Vietnam thanks to a robust expansion of the manufacturing and service sectors. Both these sectors now need skilled labor, which the Vietnamese higher education system is currently failing to supply due to capacity and quality constraints. Therefore ambitious students will continue to look overseas for the training they need to take part in the Vietnam growth story.
According to the findings of a 2010 IIE Briefing Paper, based on 700 responses to a survey conducted in three major metropolitan areas among high school and university students, the U.S. is overwhelmingly considered by Vietnamese as their first-choice overseas study destination (first choice for 82 percent of those surveyed and second choice for 10 percent). In addition, it was rated the highest for overall favorable impression compared to the U.K., Australia, Singapore and France. It is perceived as a scientifically and technologically advanced country with an excellent higher education system and a wide range of schools and programs offering many scholarships; however, cost was cited as the primary obstacle to being able to studying overseas (84 percent said it was an obstacle). The United States fared especially poorly in the perceived cost category (tuition and living expenses)
when compared to regional alternatives and competitor host nations, Australia and Singapore, both of which were cited as popular second-choice countries.
When considering the Vietnam recruitment market, institutions should therefore be aware that while the local economy has grown tremendously over the last decade, the median income in Vietnam is still very modest (2010: US$1,100). Vietnamese parents are prepared to invest in a quality education, but they are also sensitive to cost. These factors combined go a long way to explaining the popularity of U.S. community colleges. The two-year route not only represents significant savings as an avenue to a U.S. degree, but also tends to be easier to get into in terms of both language and admissions requirements.
Overseas Study Scholarships
A Vietnamese government scholarship program designed to upgrade the training of college teachers and university lecturers, due to a severe shortage of doctoral-holding faculty members, is likely to help spur an increase in the number of Vietnamese graduate students overseas in the coming years. The first round of scholarship recipients from the Project 911 program was finalized in February of this year and they will receive doctoral training at overseas and domestic institutions beginning in the fall. More than 1,000 recipients were named this year, with a goal of awarding 23,000 full scholarships (10,000 overseas) by 2020. The program builds on Project 322, launched in 2000, which saw almost 4,600 students sent abroad for advanced study. At the end of the program in 2011, some 3,000 had returned to Vietnam, with over 1,000 holding a doctoral degree.
Other Factors Pushing Vietnamese Students Overseas
The Vietnamese government has recently instituted controls on student enrollments at the tertiary level after years of unchecked growth. These checks include the introduction of student quotas, in addition to limits on institutional growth, with many private institutions of questionable standards having popped up to meet unmet student demand over the last decade.
In the last two years, the government has shuttered a number of institutions and programs it deems to have not met quality standards, with a particular focus on unauthorized foreign institutions that have been working with local partners. More recently it has said it will limit, or freeze at current levels the number of students it allows to enter the university system. If the freeze is successful, it would be fair to assume that unmet demand for university places could lead to increased consideration of overseas options.
Quality Standards and International Provision
Another government move to improve quality standards that came into force last year has placed strict new rules on institutions working with foreign partners. The provisions of Decree 73, as it is known, have a particular emphasis on ensuring that any foreign institutions offering academic programs in the country have adequate financial backing, satisfactory academic and admissions standards, and recognized and verifiable overseas accreditation or licensing. The decree is part of a broader effort by the Vietnamese government to halt the proliferation of substandard foreign-linked educational institutions that have been producing legions of poorly qualified students, predominantly in the field of business and management. The government found at the time of the decree that there were close to 120 affiliated programs that did not meet government quality standards being offered by 94 foreign partners at 18 domestic universities.
The only 100 percent foreign-owned branch campuses that currently operates in Vietnam and enjoys government approval is Australia’s Royal Melbourne Institute for Technology. RMIT Vietnam  was launched in 2001 and has since grown to more than 6,000 students across two campuses, making it one of the biggest branch campuses in the world. The university offers programs in business and management, design, communication, engineering and technology, with English and pathway programs to address language and academic deficiencies for incoming students.
Just recently, the Vietnamese government has announced that it will invest US$150 million to create a state-of-the-art university of technology in Hanoi, with Russia as the academic sponsor. This is the latest in a series of partnerships forged with foreign governments aimed at creating world-class universities. Under similar arrangements, the Vietnamese German University  was established in 2008 in Ho Chi Minh City, and the University of Science and Technology in Hanoi  was created in 2009 in a partnership with the French government. Two other projects are also being negotiated, one in partnership with the Japanese government and the other with the United States. Both the German and French university-partnered projects have gotten off to slow starts, with slower than expected enrollment uptakes.
For students looking overseas, the government also recently introduced new quality checks on third-party recruitment agents. As of March this year, they have to meet minimum financial liquidity standards in addition to academic standards that include a university degree and proficiency in at least one foreign language.
Vietnam is a country in transition. It has an economy that was once red hot, but has recently suffered setbacks related to the global financial crisis, bad debt and a lack of trained labor qualified to propel industry forward. The Vietnamese government is focused on improving quality standards in education and refocusing training on priority areas such as foreign language acquisition, science and technology instruction, and the expansion of vocational training.
Vietnamese society continues to place a high value on education, and while growth trends in international enrollments have tapered in recent years compared to the breakneck increases of the second half of the last decade, renewed global economic growth should allow Vietnam to reassert itself as an international, low-cost manufacturing hub. Subsequent increases in gross national income are likely to be invested in part in overseas training for the next generation.