2+2 = more work to be done

Macau has established itself as the region’s gambling capital. Thailand leads the region with its medical tourism. And India is the world’s IT and telecommunications-services hub. Vietnam is focusing on manufacturing to help move it to the next level. And let’s face it, Vietnam has made impressive strides. Between 1990 and 2008, it reduced the poverty rate to 14.5% from 58.1%, according to the UN.

“But manufacturing isn’t going to raise the standard of living to a middle-class society,” noted a banker on a recent trip to Hanoi.

She argued that low-end manufacturing is a short-term fix. Taking the leftovers from China may provide work now, but it’s not a sustainable long-term economic growth plan for the nation, given that low-end manufacturing margins are increasingly squeezed. That is why China is getting out of it and attempting to move up the food chain.

One hope expressed by government officials is that Vietnam could become a mathematics powerhouse, which would lend itself to becoming a hub for a range of industries from high-tech design and manufacturing to quantitative work for the financial industry. To that end, the government announced in mid-August that it would spend $34.2 million to develop its expertise in mathematics during the next 10 years. Prime Minister Nguyen Tan Dung told local media he approved a programme aimed at “fostering maths research, application and teaching, both qualitatively and quantitatively”.

The goal is to become one of the top 40 countries in relation to maths by 2020, up from its current ranking at 54. The rationale for assuming it can succeed in pushing maths is that young Vietnamese students have stood out in the field. A fact frequently trotted out by proud politicians is that six Vietnamese students attending the 51st International Mathematics Olympiad in Astana, Kazakhstan, in July won one gold, four silver and one bronze medals.

While that’s all well and good, both local mathematicians and employers have quietly raised a few red flags. Professor Le Tuan Hoa, deputy head of the Mathematics Institute, noted that the number of good students who choose to pursue mathematics as their first degree is actually on the decline. He said only 850 Vietnamese scientists have ever completed a mathematical research work and, worse, no Vietnamese universities use modern mathematics teaching methods.

So there’s work to be done. “I’d say the focus should be on English as well. Without that, we still have to import upper level talent at banks,” said one local banker at a multinational firm.

English

The Ministry of Education and Training had earlier stated an aim that 20% of primary school pupils across the nation would be taught English in the 2010-11 academic year.

Under the programme, English would have been a compulsory subject for third-grade to fifth-grade students who would have had four lessons per week. This hardly would have been enough to create a literate or even English language conversant work force of the future, but it was a start. That failed. A shortage of teachers has forced the ministry to withdraw the plan.

While English may be the lingua franca of banks, it’s not necessary for other industries -- and Vietnam stands out for its local language literacy rate. That is, once again, until you scratch the surface. The total national literacy rate is high, at 90.3% for adults, according to Unesco. Yet despite the impressive progress, there are still gender, regional and ethnic disparities -- not surprisingly, the rate of illiteracy in remote areas makes up more than 35% of the national total, yet these people make up just 13.5% of the national population.

Illiteracy rates are particularly high among ethnic minorities and women. Illiteracy stands at 75% and 88% among ethnic Dao and H’mong communities respectively. Furthermore, there are also high drop-out rates among children from ethnic minorities in remote villages, notes Unesco.

One might argue that it is not surprising that rural areas struggle on the education front -- it is a developing nation, after all. However, the bigger problem is the university-level schooling, which isn’t just struggling on the aforementioned maths front. In a 2008 Harvard Kennedy School report, Thomas Vallely and Ben Wilkinson wrote: “It is difficult to overstate the seriousness of the challenges confronting Vietnam in higher education. We believe without urgent and fundamental reform to the higher education system, Vietnam will fail to achieve its enormous potential.”

Experts say this has yet to be addressed. Once again, at first blush statistics look good -- of those who complete their five-year primary education, 90% continue to higher education.

In other words, make it through the beginning and chances are good you’ll go the full mile. However, overseas educated Vietnamese bemoan the quality of university-level education, saying it’s not even comparable to a good Hong Kong secondary education. To prove the point, they question: can you name a quality university in Vietnam? Nope. Can you even name a university in Vietnam? Probably not.

For now, multinational banks will carry on importing talent, and private equity firms will continue to tour the nation looking for opportunities and then exit because one of the concerns is a lack of truly talented, well-educated upper management. But if Vietnam wants to move to the next level, it’s going to have to start with primary school.

This article was first published in the October 2010 issue of FinanceAsia magazine.

Picture provided by AFP.