Key points
- A burgeoning middle class, youthful demographics and evolving workforce needs will continue to drive strong demand for education services in Southeast Asia to 2040.
- Australian education providers will be well placed to supply this demand, but will need to be responsive to evolving student preferences and industry needs.
- Continued investment in Australia's education offerings, advocacy, alumni and scholarships will help drive Australia's economic and people-to-people connections with Southeast Asia.
Sector overview
Australia's education sector is a national asset in our engagement with Southeast Asia. It has been integral to building enduring relationships and economic prosperity with the region. Over the past 20 years, over half a million Southeast Asian students have studied in Australia.137 High-quality Australian education can continue to help countries of the region transform their economies further up the value chain, enabling them to seize opportunities offered by rapid technological change.
Southeast Asia's education and skills needs are diverse and cross-sectoral. As the region grows and needs an increasingly skilled workforce to meet the demands of technological advances and the clean energy transition, more young people will be looking to tertiary education. This will drive strong demand for education services in Southeast Asia to 2040 – Indonesia alone is planning to add 57 million skilled workers to its economy by 2030.138
Education is one of Australia's largest services exports to Southeast Asia and contributes to the economy in many ways. The value of education-related travel exports alone was $5 billion in 2022,139 and the export income from courses was A$360 million in 2021–22.140
In 2022, Indonesia, Malaysia, the Philippines, Thailand and Vietnam were all top 10 source countries for international students studying in Australia.141 Tertiary education and vocational education and training (VET) make up the majority of enrolments. In 2022, school students from Southeast Asia represented 29.3 per cent of international students enrolled in the school sector in Australia.142
Southeast Asia is also one of Australia's largest transnational education markets, which covers offshore campuses, offshore partnerships with local providers, and hybrid and online offerings. Australian transnational tertiary education providers have established campuses in Indonesia, Malaysia, Singapore and Vietnam (Figure 7.1), with RMIT and Monash University the first foreign universities to operate branch campuses in Vietnam and Indonesia respectively. In 2021, the largest numbers of tertiary education enrolments with Australian transnational education providers in Southeast Asia (including in-country campuses) were in Singapore (23,621), Malaysia (17,246) and Vietnam (12,885).143
“Relationship building and patience were key to Monash’s success.” (Monash University).
Australia's tertiary education and vocational education and training capabilities are well positioned to support the region's skills uplift (see Monash University case study). Post-pandemic, enrolment numbers from Southeast Asian students at Australian campuses in Australia and the region are again rising, and demand will likely continue growing to 2040.144 Demographic shifts and industry megatrends will provide further significant opportunities for Australian education providers. Individuals' education journeys are diversifying – with more mature age students, 'nonlinear' careers, and a focus on continual learning and upskilling.145 The global online education market is expected to more than double from 2022 levels by 2032.146
Micro-credentials present an increasingly appealing and cost-effective means of upskilling and can be delivered at scale, support bespoke industry training, and provide industry endorsement or certification. Opportunities exist in Vietnam, Thailand, the Philippines, Indonesia and Malaysia to deliver industry-recognised micro-credentials in areas such as tourism and hospitality, ICT, cybersecurity, construction and food production.147 William Angliss Institute is one example of an Australian institution that has successfully adapted its offerings to the region's needs (see case study).
Figure 7.1 Australian branch campuses in Southeast Asia
Source: DFAT, Austrade and Department of Education
Case study: Monash University helping meet education demand in the region
Monash has nearly 5,000 students from ASEAN nations enrolled in its Australian campuses and over 9,000 students enrolled in its campuses established in Malaysia and Indonesia. Over 50,000 Monash University alumni live in Southeast Asia.
Monash's Malaysia campus was established in 1998 and has evolved from an early focus on undergraduate education to become a world-class research presence with 500 students currently undertaking PhD programs. The medical degree offered at Monash Malaysia was the first outside Australia and New Zealand to be accredited by the Australian Medical Council.
Monash is also seeking to further enhance its contribution in developing the health system and related research capacity in Southeast Asia. For example, Monash is leveraging partnerships between its medical school, the Monash Victorian Heart Institute, Institut Jantung Negara and the Malaysian Ministry of Health to advance cardiovascular medicine research and clinical care.
Monash's campus in Indonesia was established in 2021 as Indonesia's first international, foreign-owned university. Indonesia's growing regional and global importance, its young population and Monash's long history of connection with Indonesia influenced Monash's decision to open there. Offering masters and PhD programs, the institution partners with industry on training and research and engages in collaborations directed towards a positive impact on Indonesia's social, technological and economic development. The model provides a pipeline of talent to support the economic and social progress of Indonesia, and is geared to increasingly support the innovation needs of Indonesia tomorrow through research training.
Monash University Indonesia President, Andrew MacIntyre, said, 'Monash benefited from advocacy from the Australian Government in both Indonesia and Malaysia in support of our ongoing interests, including establishing these campuses.'
'Relationship building and patience were key to Monash's success in establishing the Jakarta campus,' Professor MacIntyre said. 'We also encourage others looking to engage in the region to consider the potential of alumni of Australian universities to help when entering the market and building your presence.'
Case study: Building tourism capability – William Angliss Institute
William Angliss Institute (WAI) is a global leader in vocational education, specialising in tourism, food, hospitality and events education and training. It has a physical presence in Australia, Singapore, Vietnam, Sri Lanka and China.
Amid the pandemic, WAI collaborated with Cambodian counterparts – the Cambodian National Committee for Tourism Professionals and Thalias Hospitality Group – to deliver a hybrid 'train the trainer' program for 68 food production professionals, combining face-to-face and online sessions. This program honed the skills of the participants, preparing them for the post-pandemic reopening of international tourism. Additionally, the program had a broader impact on Cambodia's vocational framework for food production, facilitating links between industry and vocational education providers, further supporting workforce development.
For over 15 years, WAI has collaborated with the ASEAN Secretariat to foster tourism sector growth in the region, including through developing common standards and the framework for the Mutual Recognition Arrangement on Tourism Professionals. WAI also supported the creation of the Common ASEAN Tourism Curriculum, offering 52 qualifications from certificate to advanced diploma levels. To enhance capability, WAI has developed train-the-trainer programs.
WAI's Director, International and Business Development, Mr Wayne Crosbie, said, 'William Angliss was fortunate to have been involved in such a strategic project funded by the ASEAN–Australia Development Cooperation Program to enable this groundbreaking work to be undertaken. It has delivered very positive outcomes for the 10 ASEAN member states in assisting them to implement the Mutual Recognition Arrangement on Tourism Professionals, facilitating the mobility of skilled labour and improving service standards throughout the ASEAN region. It has also provided WAI with ongoing training and consulting work to continue to support the regional growth of the tourism industry.'
Maintaining Australia's attractiveness as an education destination of choice will also require concerted effort to promote the quality of the student experience. This should be consistent for students, regardless of the mode of delivery or study location. Providers must ensure appropriate support services are delivered to students, taking into consideration local and cultural sensitivities. A key part of supporting a quality experience for Southeast Asian students in Australia will relate to ease of entry for individuals (including visiting relatives), student work rights, post-study work rights and graduate employment prospects.
Australian providers are facing increasing competition in Southeast Asia. Canada, the United Kingdom, the United States, Japan, China and the Republic of Korea are all boosting their education offerings.148 Some Southeast Asian countries have also strengthened the local capacity of their education systems, with growing numbers of the region's universities achieving higher rankings globally, attracting local and intra-regional students. However, current capacity constraints will continue to place limits on domestic education and training options within Southeast Asia.
More favourable regulatory environments in Southeast Asia will be conducive to boosting Australia's education offerings in the region. For example, Vietnam's regulatory framework enables universities to develop different models of joint teaching programs and allows Vietnamese universities to self-approve joint programs.149
The Indonesian Government has also relaxed requirements for foreign universities establishing campuses in Indonesia, including more streamlined qualifications recognition and accreditation processes.150 The Philippines is easing legal restrictions on international education operation and investment,151 and Thailand is prioritising transnational tertiary education partnerships and reforming its VET system to allow further opportunities for providers to deliver training.152
International alumni networks are a strength of Australia's education offerings, providing ongoing and longstanding benefits for people-to-people links within the region. This includes numerous government and business leaders from the region who have chosen to study in Australia or at Australian offshore campuses. Currently, the Australian Government supports alumni engagement through individual programs and embassy-led initiatives, while providers support course and institution-based communities. But submissions from the University of Melbourne and the University of Canberra suggested this engagement could be strengthened, including through the development of a coordinated international alumni strategy in partnership with the tertiary sector.153
Australia's education ODA to Southeast Asia in 2023–24 is estimated to be A$197.6 million, reflecting Australia's commitment to ongoing engagement to support human capital development in Southeast Asia.154 An example of this assistance is through a VET project under the Vietnam–Australia Human Resource Development (Aus4Skills) program, which aims to equip VET graduates with skills that meet logistics industry workforce demands, improve VET college organisational management, and strengthen Vietnam's VET quality assurance framework.
Australia also demonstrates its commitment through the offering of scholarship programs to Southeast Asian students. Long-term scholarships and mobility programs enable enduring connections to be created.155 Industry submissions acknowledged the important role Australian scholarship programs have played in developing people-to-people links and stronger institutional ties with Southeast Asia. Melbourne Polytechnic and Box Hill Institute proposed that the New Colombo Plan could be expanded to the VET sector.156 Submissions from the Group of Eight and University of Sydney also suggested the New Colombo Plan's expansion could cover postgraduate and research students.157 A submission from the University of New South Wales highlighted the benefit of short-term placements in raising participation rates by students from low socio-economic backgrounds, part-time students, and students with disability.158
The Australian Universities Accord Interim Report makes a number of recommendations on creating a sustainable and globally connected international education system in Australia. Those recommendations are consistent with key themes that emerged from strategy consultations. These themes include strengthening visa pathways for international students; promoting flexibility in the delivery of international education (digital and offshore options); providing a high-quality experience for international students; improving overseas skills and qualifications recognition, and expanding international professional qualifications accords; promoting international commercial use of Australian research capability; and building closer connections between institutions and their international alumni.159
Pathways to 2040
In addition to the cross-cutting recommendations outlined in Chapter 2, which will have a broad economic impact, this chapter has additional specific recommendations on education and skills.
Raise awareness
In the context of growing competition, Australia will need to do more to promote its education offerings to maintain and increase demand for Australian education and training.
Building upon the existing Study Australia website and Study Australia Partnership, additional resources are needed to support a whole-of-nation effort to promote Australian education. Promotion of education products should be in Southeast Asian languages as well as English and tailored to the diverse range of education stakeholders, including students, parents, education agents, alumni and professional bodies. This requires a further investment by government and industry in digital marketing products and services.
Recommendation
- Australian Government to invest in education promotion across Southeast Asia to raise awareness of Australia's offerings and attract more Southeast Asian students.
Remove blockages
The expansion of the Australian education provider presence and provision of course offerings in Southeast Asia has been the product of extensive and concerted advocacy by institutions and the Australian Government. Barriers to establishing physical campuses, and to course provision and recognition, continue to persist in parts of the region. Assisting Australian institutions to access markets will need to continue to be a priority for industry and Australian Government engagement with some regional governments to encourage regulatory changes.
Recommendation
- Support expanded offshore delivery of education services through further Australian Government advocacy.
Maintaining Australia's position as a destination of choice for students to 2040 will require competitive policy settings, in line with key competitor countries that have adjusted visa settings and provide employers greater confidence and certainty in recruiting and retaining international graduates. Visa policy should also include consideration of international students undertaking an Australian qualification through transnational education. Some recent changes have been made, including an increase in the duration of post-study work rights of international students by two years in certain occupations and qualifications from 1 July 2023, with further reforms to be considered as part of the Australian Government's Migration Strategy.
Recommendation
- Australian Government to continue reviewing Australia's education visa settings to ensure they are competitive and fit for purpose to 2040.
Recognition of qualifications is a fundamental enabler of student, graduate, worker and institutional mobility. Greater cooperation in this area, including on new modes of delivery, will be critical to minimising barriers, supporting a more complementary regional approach to qualifications recognition, and increasing trade in education services. Opportunities for engagement and cooperation include through the UNESCO Tokyo Convention and Global Convention, the ASEAN Qualifications Reference Framework, and greater information exchange on systems for education and training, qualifications, quality assurance, and qualifications recognition.
Recommendation
- Australian and Southeast Asian governments to increase cooperation with professional bodies and education providers on qualifications recognition.
Build capability
Australia is committed to driving two-way student exchange with Southeast Asia, including through scholarships. Australia continues to evolve the Australia Awards offerings to ensure these scholarships and conditions for students remain contemporary and competitive. Submission feedback recommended elements of Australia's scholarship and mobility programs could be updated and expanded to ensure they remain fit for purpose, flexible and appealing to a range of students.
The Australian Government is not alone in offering scholarships to Southeast Asian students wishing to study in Australia. State governments, Australian universities and Southeast Asian governments also provide scholarships, which brings further students from a range of socio-economic backgrounds to Australia. To widen these opportunities on offer, governments should look to explore co-financing further scholarships with universities and Southeast Asian governments.
Recommendation
- Australian Government to expand outbound scholarship and mobility programs to include postgraduates and VET students.
- Australian governments to seek opportunities for co-financing with universities and sending countries to increase scholarships for Southeast Asian students.
Southeast Asian students in Australia can make an enhanced contribution to building enduring linkages and understanding between Australia and the region.
Work-integrated learning, such as internships and placements, offer students the opportunity to build professional networks, gain practical skills and experience in their chosen field and demonstrate capability to prospective employers. Work-integrated programs are strongly correlated with positive employment outcomes.160 Importantly, work-integrated learning also provides both students and employers the opportunity to build cultural literacy.
Australian institutions are well placed to expand opportunities for work-integrated learning and broadening business participation, including with the region's network of business chambers and councils. For example, Universities Australia has said that around 500,000 work-integrated learning placements occur each year in Australia, and with the right policy settings and industry support in place, a further 500,000 could be easily absorbed.161
Recommendation
- Australian Government to encourage universities and vocational education providers to offer work-integrated learning internships as part of course offerings to Southeast Asian students.
Current government alumni programs focus on scholarship students. This should be expanded to encompass alumni of all Australian courses, including short courses and offshore delivery, and both scholarship recipients and privately funded students. Working across governments, business and the education and skills sector to develop an alumni initiative would ensure a joined-up approach. Such an initiative could consider piloting an engagement program to connect alumni with Australian and Southeast Asian business in Australia and the region.
Recommendation
- Australian Government to coordinate a whole-of-nation initiative to better engage alumni, including a scheme for connecting alumni with Australian and Southeast Asian businesses.
Deepen investment
Australia has a strong foundation to expand research collaboration with Southeast Asian universities, with many Australian institutions already supporting substantial research efforts in countries where they have a presence. However, there is an opportunity for the research community and the Australian Government to enhance this effort through a more strategic approach to investment in research collaboration with Southeast Asian countries. The Group of Eight submission suggested that the Australian Government and industry could consider jointly funding a scholarship program for prospective Southeast Asian students to conduct research in areas of shared national priority.162
Recommendation
- Australian Government to work with industry to fund a Southeast Asia research grants scheme in areas of mutual interest with Southeast Asia.
137 Department of Education, International students studying in Australia between 2002 and 2022 [dataset], 2023, accessed 29 June 2023. Figures include 10 ASEAN member states and Timor-Leste.
138 Department of Foreign Affairs and Trade (DFAT), A Blueprint for Trade and Investment with Indonesia, DFAT, Australian Government, 2021, p. 67.
139 Australian Bureau of Statistics (ABS), International Trade: Supplementary Information, Calendar Year, ABS website, 2022, accessed 13 July 2023.
140 Australian Bureau of Statistics (ABS), International Trade: Supplementary Information, Financial Year, ABS website, 2021-22, accessed 10 July 2023. Does not include Timor-Leste.
141 Department of Education, International students studying in Australia between 2002 and 2022 [dataset], 2023, accessed 3 May 2023.
142 Austrade, Data analysis provided to DFAT, Austrade, Australian Government, 2023, unpublished.
143 Department of Education, Data analysis provided to DFAT, Austrade, Australian Government, 2023, unpublished.
144 Austrade, International Student Data [dataset], 2023, accessed June 2023.
145 C Castrillon, 'Why non-linear careers paths are the future', Forbes, 26 February 2023, accessed 5 July 2023.
146 Global Market Insights, E-learning Market Trends 2023–2032, Global Report, May 2023, accessed 13 July 2023.
147 Department of Education, Data analysis provided to DFAT, Department of Education, Australian Government, 2023, unpublished.
148 Department of Education, Data analysis provided to DFAT, Department of Education, Australian Government, 2023, unpublished; S Patton, 'Crumbling cornerstone? Australia's education ties with Southeast Asia', Lowy Institute, 4 November 2022, accessed 29 June 2023.
149 Vietnam Government, Decree 86/2018/NP-CP on Foreign Cooperation and Investment in Education, effective 1 August 2018; Vietnam Government, Decree 99/2019/ND-CP on Elaborating and Providing Guidelines for a Number of Articles of Law on Amendments to Law on Higher Education, effective 15 February 2020.
150 Indonesian Government Ministry of Education, Ministerial Regulation Number 23 of 2023 on the Operation of Foreign Higher Education Institutions, dated 28 March 2023.
151 The 2019 Transnational Higher Education Law provides a legal framework for foreign higher education institutions to establish and operate in the Philippines. Amendments to the Philippine Foreign Investment Act passed in 2022 will ease restrictions on foreigners practicing their professions in the Philippines and grant access to investment areas previously reserved for Philippine nationals, including education.
152 Department of Education, Data analysis provided to DFAT, Department of Education, Australian Government, 2023, unpublished.
153 Submissions from University of Melbourne and University of Canberra.
154 Department of Foreign Affairs and Trade (DFAT), 'Education and skills: Development Cooperation Factsheet', DFAT, Australian Government, 2023.
155 S Patton, 'Crumbling cornerstone? Australia's education ties with Southeast Asia', Lowy Institute, 4 November 2022, accessed 29 June 2023.
156 Submissions from Melbourne Polytechnic and Box Hill Institute.
157 Submissions from Group of Eight and University of Sydney.
158 Submission from the University of New South Wales.
159 Australian Universities Accord Review Panel, Australian Universities Accord Interim Report, Australian Government, 2023.
160 P Hurley, M Coelli, B Ta, L Knight and M Hildebrandt, Industry experiences and their role in education to work transitions, Department of Education, Australian Government, 2021, p. 34.
161 Universities Australia, stakeholder consultations, 5 July 2023.
162 Submission from Group of Eight.