Friend, Philosopher and Guide to Educators
February 2016

Friend, Philosopher and Guide to Educators

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Ross Barfoot

Ross Barfoot
Partner & Head of Education at the
global law firm, Clyde & Co

Across the Middle East and North Africa, governments are actively investing considerable capital to reform and improve education systems. In an interaction with Manish Arora of Elets News Network (ENN), Ross Barfoot, Partner & Head of Education at the global law firm, Clyde & Co, gives some insights about the emerging education market in the region

Setting up an educational institution of global magnitude calls for a diverse expertise. How does Clyde & Co support setting up of greenfi eld projects in education?

Clyde & Co has a leading, diverse education practice based across the Middle East and North Africa (MENA) region comprising specialist lawyers from a range of legal disciplines across the fi rm, including corporate, commercial, regulatory, dispute resolution, employment, intellectual property, construction and real estate. We provide commercial, pragmatic and innovative advice to education sector clients on all aspects of their business. Our depth of understanding of the education sector means that we understand our clients’ operating environment and commercial needs, and is a direct result of a long-standing track record of advising clients in this sector.

We are also connected to education practices and education-focused lawyers from across our network of 45 offi ces across six continents, including the UK and Europe, North and South America, and Asia and Australia. Our education clients include public and private sector players, operators and investors specialising in education investments as well as primary, secondary and tertiary educational institutions, local education authorities, educational administrative organisations and professional bodies.

We are committed to helping our clients succeed in the markets in which they operate, adapt their businesses to changing market developments and guide them through new territories as they plan for future growth. Our lawyers have extensive experience of advising on complex corporate structures that meet our clients’ specifi c requirements and are in keeping with the laws and practices of the jurisdictions in which they operate.

A lot of Indian edu-preneurs are keen to set up institutions in the Middle East. What are some of the key differentiating elements of this market which makes it attractive?

The Middle East has one of the fastest growing education markets in the world. Recent reports have demonstrated signifi cant growth in demand, enrolment rates and fees available in the sector. These have been fuelled not only by private investment but also increasingly by regional governments.

Across MENA, governments are actively investing considerable capital to reform and improve education systems, enhance human capital and promote themselves as knowledgebased economies. Growth in this market is being largely driven by favourable demographics, increasing demand for better standards of education and growing private participation as a result of signifi cant investment opportunities.

Around 35 per cent of the Middle East region’s population is under the age of 25 and UNESCO has estimated that there will be an additional 9.5 million students by 2030 across the GCC.

There are simply not enough schools, colleges and universities, either public or private, for them. Governments in the region, particularly in the GCC, have the money to invest in the sector and are increasingly doing so. Government expenditure on education in the GCC now accounts for around a quarter of all total public expenditure. A shortage in the K12 private education sector also makes the region attractive to investors.

“We are connected to education practices and education-focused lawyers from across our network of 45 offi ces across six continents, including the UK and Europe, North and South America, and Asia and Australia”

Parents in the region are ready to invest in their children’s education; rather than the fees, it is mostly the quality of teaching and the reputation of the institution that play a part in parent’s decision-making. They just need the schools to be able to do so. The demand for private schools is across the expat and local population, with an increase in the number of UAE nationals moving their children from state-operated schools to private schools, because of a perception that they offer a better quality education. We have seen a greater number of “premium quality” schools entering the market because parents will pay high fees if they feel their children are getting premium quality education. However, we now see greater opportunities for Indian curriculum schools, and those schools coming in at the mid-level fee bracket.

Your fi rm is connected to education practices across the globe. What’s your understanding of the education market? What are the key trends that will dominate the educational landscape in the years to come?

A key trend we are seeing across our MENA and Asia offi ces is a drive by Indian and Western institutions to expand internationally. As their home markets remain fl at, schools and universities are looking to establish themselves across these regions where demand for places continues to grow. The investors are keen to partner with established education brands to take advantage of that growth. This is in line with the current trend globally on the use of private capital to fund development of education, particularly in developing countries.

Education for long has been seen as a social good. However, there is a shift to make it market driven. What are the key regulatory challenges or pitfalls of an entirely market-driven model?

I don’t think the two are mutually exclusive. The UAE education sector is heavily regulated, with both KHDA and ADEC enforcing caps on school fees linked to performance, and day-today regulatory compliance increasing. However, we are seeing an increase in private for-profi t schools and that trend will continue as long as investors see opportunities. Regulation should always refl ect the lifecycle of the education sector. Currently in the region a shortage in schools means that fee caps are needed to ensure parents can afford to send their children to school and employers can afford to recruit staff with school-age children. As the number of school places increases, we will see an increase in competition for admissions, and then we will naturally see the market taking over to regulate the school fees.

Out of your vast experience, what do you think are the key hallmarks of a globally-acclaimed educational operating ecosystem?

Regulators need to make it as attractive and as easy as possible for new quality institutions to be established and attractive to private capital, while at the same time ensuring high educational standards and access to education for all children. An unenviable task for any regulator!

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