As the population expands and tuition fees continue to rise, the private school education market is fast becoming a magnet for investors and is forecast to grow by more than 60 percent over the next five years, according to a new report.

According to a report issued on Tuesday by consultancy firm The Boston Consulting Group (BCG), entitled ‘Where to Invest Now in the GCC Private Education’, the United Arab Emirates’ private K-12 education market – students aged three to 12 years-old – was worth $4.4 billion in 2017, but will grow to be valued $7.1 billion by 2023.

While strong growth is forecast for the next five years, the report identified some key positive and negative factors that potential investors should look out for:

Shift towards private schools: The report said it costs parents around $11,000 per student per annum for their children to attend private schooling in the Gulf, higher than in most developed countries. However, the report said parents were increasingly willing to invest in high quality education for their children, which should benefit schools which score high ratings in the annual league tables.

Tuition fees: Across the six countries of the Gulf Cooperation Council (GCC) region, school fees are increasing by between two and four percent per year, the report said. However, it said economic constraints means many companies are clamping down on the lucrative expatriate packages offered in previous years and free schooling or education subsidies are some of the key elements being cut.

Population growth: The student-aged population, or those aged between three and 17, is growing by between one and three percent, the report said.

Enrolment growth: Attendance to preschool level (students aged three to six) is increasing the report said. Kindergarten attendance also has room for development, especially in Saudi Arabia, where enrolments rates are less than 20 percent, compared to up to 90 percent in other parts of the GCC, the report added.

“The private education market has become increasingly complex and competitive in recent years, particularly in mature markets—and these shifts have implications for investors. The plethora of private schools available in the UAE is almost unmatched on a global scale,” Maya El Hachem, principal at The Boston Consulting Group, said in a press release accompanying the report.

“In the UAE, attractive opportunities can be found…. There is also opportunity for investors to leverage Dubai’s drive to become a test-bed for innovation by introducing schools with modern, digital approaches to education,” she added.

(Read the full report).

Further reading:
• Dubai school fees fall along with home rents
• Qatari schools get official nod to raise fees
• Soon a law to check random school fee hikes
• Kuwait minister officially halts private school fees increase
• Bahrain rules out school fees for expat students
• Where are the priciest schools in the Middle East?
• Schools should not shame students for unpaid fees

(Writing by Shane McGinley; Editing by Reem Wafai)
(shane.mcginley@thomsonreuters.com)

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