Malaysia as an international hub for higher education: Too much or not enough?

by Professor Dr. Francois Therin

Recently, foreign universities such as the United Kingdom’s Heriot-Watt University and University of Reading announced the opening of their branch campuses in Malaysia. Several other universities also intend to expand their operations here, including Manipal University of India which plans to open a campus that could accommodate up to 20,000 students.

The news is hardly surprising as the Malaysian Ministry of Higher Education has indicated that up to 25 foreign universities have applied to open branch campuses in the country.

Inevitably, it has triggered a strong reaction from the existing players, with some trying to convince the ministry that by allowing an overly large number of foreign branch campuses to operate, the competitive landscape would be adversely affected.

Such a reaction would be deemed quite normal in any industry, but it would be interesting to ponder whether it is reasonable or not.

Firstly, let us look at some figures related to higher education in Malaysia. Currently, there are approximately 1.1 million tertiary students in Malaysia, including 500,000 pursuing bachelor degrees and 400,000 pursuing diplomas. Among the 1.1 million students, some 80,000 are international students with the majority representing five countries – China, Iran, Indonesia, Nigeria and Yemen.

Yearly, the higher education sector sees an enrolment of 400,000 new students while 250,000 graduate from different universities throughout the country.

These students are served by 21 public and 23 private universities, including five foreign branch campuses. They also come from 21 private higher education institutions with university college status. In fact, more than 20 other foreign universities are already actively operating in Malaysia through twinning programmes with the university colleges.

So, is it likely 25 new players would negatively affect the competitive landscape?

Clearly, Malaysia aims to become a higher education hub. Despite marketing higher education internationally much later than Singapore, it already has more international students, the number having doubled since 2006. The objective now is to reach 200,000 by 2020.

Of course, many of the universities exist to diversify the sources as the current major ones could be subject to internal political changes, which could consequently affect the number of students sent to Malaysia. For example, Oman recently announced that it would send up to 4,000 students a year compared to only 400 in 2010.

Meanwhile, student intakes from India and Egypt, as well as neighbouring countries such as Thailand or Vietnam, are very low and have not met the forecasted numbers. For instance, there are only 1,400 students from India.

In Malaysia, a bachelor degree has become the minimum requirement for one to land a first-time skilled job. Malaysia’s economy is doing very well and employers’ increased need for qualified staff has created a demand for more graduates, particularly from critical fields such as engineering, business and medicine.

There is a natural growth in the local student population. We can expect the population to continue to grow, and subsequently, a greater demand for universities to offer higher degrees. There are currently only 63,000 students pursuing studies at the Masters level and 21,000 at the PhD level.

Malaysia is making a clear stand on quality, though at the start of the internationalisation process, and as many other countries did, more importance was placed on quantity rather than quality. Take the recent issues in Vietnam, for example. Malaysia is now very carefully monitoring the quality of the existing institutions, both public and private, and is becoming more and more exacting when considering the applications of new players.

The implementation of a very detailed and stringent rating system for the country’s universities, the SETARA Rating System for Institutions of Higher Learning, is helping raise standards.

In the field of business, for example, public institutions have been asked to go for international accreditations such as EQUIS (European Quality Improvement System) and AACSB (Association to Advance Collegiate Schools of Business). Not compromising on quality will certainly convince local students to study within Malaysia rather than go overseas.

Currently, around 80,000 Malaysians are studying abroad – 30,000 of them under scholarships and 50,000 self-sponsored. This indirectly raises the attractiveness factor for international students to pursue their tertiary education in Malaysia, particularly those from countries where the number of higher education institutions is still too low to meet internal demand and/or where the move toward quality has not been effectively implemented.

Therefore, I do not share the concerns of some of my colleagues on the competitive risk. On the contrary, I believe that more competition can help to strengthen the path toward better quality. It will also offer a wider choice for local and international students in Malaysia, and subsequently, reinforce the country’s vision of becoming an international education hub.

Professor Dr. Francois Therin is the Dean of the School of Business at Curtin Sarawak. His teaching and research interests cover strategic management, technology and innovation management, and high-tech innovation for small firms and technoentrepreneurship. His views on higher education have been published in The Guardian online edition and University World News, and are also available on his blog atfrancoistherin.wordpress.com. Dr. Therin can be contacted at +60 85 443 939 ext. 3841 or by e-mail to therin@curtin.edu.my. He can also be followed on Twitter @ftherin.