Globalization and its effects on the development of educational service in Vietnam

Since 1986, Vietnam has been conducting a process of economic innovation .

Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 Foreword 1. Inevitability Since 1986, Vietnam has been conducting a process of economic innovation . It has been steadily opening its economy to be able to integrate into the global marketplace more and more. During this time, the world in which we live has greatly changed. The collapse of the Soviet Union was followed by the world fully embracing, the form of government employed by the three economic superpowers: the US, EU, and Japan. The rapid development of technology has radically changed the face of global economy. In particular, information technology and communication technology have altered the face of the global economy, making it increasing rapidly. As proclaimed by the title of a recent famous book “The World Is Flat”. International trade activities, global investment activities and migration around the world are three remarkable dimensions of today’s global activities. It is now so easy to trade with other countries, even with particular individuals in other country; that the capital can now flow throughout the world with ease. Today, individuals can easily visit every country on Earth. We call this process “globalization”, we are now living in “ the globalization age”. In 2007, Vietnam joined in the World Trade Organization( WTO). This leads us to believe in that Vietnam is inclined to increasingly participate in this “ flat world”. This country of eighty million people is becoming a “vital” part of the global economy. The deeper Vietnam takes part in the global economy, the greater the impact of globalization on Vietnam becomes. Globalization affects every aspect of Vietnam: Economy, Social, Culture, .and even its education system. There is a mutual correlation between education and globalization, reflecting how globalization impacts education , and how education responds to globalization in turn. Historically, education in Vietnam has always been very important; the Vietnamese people have always cared deeply about this issue. The impact of globalization on Page 1 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 education in Vietnam is an issue of rising importance. Accordingly, I have conducted research on “ Globalization and its effects on the development of educational service in Vietnam” 2. Object and Field We will consider three features of globalization: international trade, global investment and migration. Taking data from 1986 in Vietnam and from 1950 across the World. 3. Research Methodology At first ,I will present a little research about how globalization affects the demand and supply of education at both the micro and the macro level in some countries such as Singapore, Brazil, and Korea, etc. I will then explore how globalization affects Vietnam’s education, also at both the micro and the macro level. Finally I will try to give suggestions for a better strategy for education services in Vietnam. 4. Table of Contents I. Foreword 1. Inevitability 2.Objective 3.Object and field 4. Research Methodology 5.Table of Contents II. The Main Content Chapter I: Overview 1.1 Globalization 1.1.2 The impact of globalization 1.1.2.1 Positive impact 1.1.2.2 Negative impact 1.1.2.3 Impact on International Relations and International Integration Processes in the World 1.2 Education Services 1.2.1 General knowledge 1.2.2Overview of education services in Vietnam 1.3 Education and globalization Page 2 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 1.3.1 Education and international trade 1.3.1.1 Education and exports at macro level 1.3.1.2 Education and global value chains 1.3.1.3 Education and offshoring services 1.3.1.4 Education and responding to trade 1.3.2 Education and the ability to attract private capital flows 1.3.2.1 Technical and engineering skills and manufacturing FDI 1.3.2.2 Centres of Excellence and attracting strategic asset seeking FDI 1.3.2.3 The effects of education on FDI at the sectoral level 1.3.2.4 Education and benefiting from FDI 1.3.3 Education and the probability of migration 1.3.3.1 permanent migration 1.3.3.2 temporary migration 1.3.3.3 Types of education 1.4 The effects of globalization on education 1.4.1 The effects of trade on education 1.4.1.1Trade and demand for education at macro level 1.4.1.2 Trade and supply of education at macro level 1.4.1.3Trade and education at the micro level 1.4.2 The effects of FDI on Education 1.4.2.1 Macro effects on demand for education 1.4.2.2.Macro effects of FDI on the supply of education 1.4.2.3 Micro effects on demand for education 1.4.2.4 Micro supply of education and training – voluntary contributions 1.4.2.5 Micro supply – vocational training 1.4.2.6 Micro supply – tertiary education 1.4.3 The effects of Migration on Education 1.4.3.1 Migration and the supply/loss in teacher capacity in the education sector 1.4.3.2 Macro effects of migration on education 1.4.3.3 Migration and private incentives to invest in human capital 1.4.3.4 Other effects of migration Chapter II: Education services in Vietnam under the impact of globalization 2.1 The impact of international trade on education services in Vietnam 2.1.1 Trade and supply for education at macro level Page 3 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 2.1.2 Trade and supply for education at micro level 2.1.4 The impact of adhering to WTO on education service in Vietnam 2.1.4.1 The thought of education has changed 2.4.1.2 The impact of adhering to WTO on education service in Vietnam 2.2 The impact of FDI on the education service in Vietnam 2.2.1 Macro effects on demand for education 2.2.2 Macro effects on supply for education 2.2.3 Micro effects on supply for education 2.3 Education services in Vietnam under the impact of migration 2.4 Education system in Vietnam under the impact of globalization 2.4.1 Education services in Vietnam and international trade 2.4.2 Education in Vietnam and FDI 2.4.3 Education in Vietnam and migration Chapter III: Strategy for developing education services in Vietnam in globalization. 3.1 Increasing the impact of education on international trade 3.1.1 developing education system to export education services 3.1.2 Education and training to adapt new global value chains 3.2 Education in Vietnam and the ability of attracting FDI 3.2.1 Attracting FDI into education services itself 3.2.2. Education system not only adapts to the need of skilled workers from FDI companies but also create a well-known workforce for Vietnam to attract FDI. 3.3 Education and migration 3.3.1 Attracting Vietnamese people who are living are working at foreign countries to dedicate Vietnam’s education development. 3.3.2 Attracting scientists all over the world coming to work and do research in Vietnam. 3.4 public policies 3.4.1 Human resource development policies 3.4.2 investment policies 3.4.3 trade policies 3.4.4 migration policies Page 4 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368  List of Acronyms and Abbreviations BAT - -British American Tobacco Group BP --British Petroleum EPZ --Export Processing Zone FDI --foreign direct investment GATS --General Agreement on Trade in Services GDP --gross domestic product GVC --global value chain HO --Heckscher-Ohlin HRDF -- Human Resource Development Fund MFA -- Multi Fibre Arrangement MNE --multinational enterprise OBM --original brand manufacturing OEM --original equipment manufacturing PSB --Productivity and Standards Board (Singapore) PSDC --Penang Skills Development Centre (Malaysia) R & D --research and development SDF --Skills Development Fund (Singapore) UNESCO-- United Nations Educational, Scientific and Cultural Organization UK --United Kingdom US --United States (of America) WTO -- World Trade Organization WB --World Bank Page 5 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368  1.1Globalisation 1.1.1 Defining globalization Globalization in this study refers to three economic features that increasingly link countries together: trade in goods and services, FDI, and migration. • Trade in goods and services: trade in goods and services has increased faster than national incomes in almost all countries. Source: IMF Chart: Increasing World Trade We consider two key processes driving this expansion in trade: increased fragmentation and emergence of global value chains. The first significant feature of the increase in trade over the past decades is fragmentation. - Fragmentation: the fragmentation of production processes is also called “vertical specialization” and is commonly referred to as the relocation of parts of the production process from one country to another. Most of the attention used to focus on fragmentation in the goods chain, but more recently attention has also focused on fragmentation of services processes. Page 6 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 The second important feature in globalization recently is the emergence of global value chains. - Global value chains involve trade through networks of firms across borders. A value chain includes the full range of activities required to bring a product or service from conception, through the intermediary phases of production( transformation and producer services inputs), to delivery to final consumers and ultimate disposal after use. • FDI, FDI to developing countries has increased dramatically over the past three decades. While most FDI is amongst developed countries, and most FDI to developing countries is concentrated amongst a few such as China, Mexico, Brazil, Malaysia . Chart: Resource flows to developing countries from 1990 to 2005 Source: WB 1.1.2 The impact of globalization 1.1.2.1 Optimist impacts Page 7 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 o Expanding market, Fragmentation and global value chains are increasingly sending products all over the world. o Transfer of technology from developed countries to developing countries has become easier. o Information and transportation networks now cover the entire World. o Fighting for peace, cooperation and development has become easier. 1.1.2.2 Negative impacts o Developed countries continue to dominate the global economy o The gap between rich and poor has increased across the world o The global economy has become increasingly fragile. o Negation in global trade has increased 1.1.2.3 Impact to international relations and international integration processes across the world o The world is moving towards an open-door policy o Multilateral relations are playing an increasingly important role in international relations o Interdependence amongst national economies has increased o In international relations, there have always existed two dimensions: cooperation and competition. 1.2Education 1.2.1 General knowledge There are several modes of acquiring human capabilities, such as education and training. We will distinguish between schooling, vocational training and tertiary education (UNESCO, 2003) in the national context, and foreign education in the international context: • Schooling. This includes primary and secondary education: primary or elementary education is the first years of formal education generally beginning when children are four to seven years of age. The division between primary and secondary is sometimes difficult to make, but it often occurs at about twelve years of age. Primary education aims to provide basic literacy and numeracy skills students and foundations in other subjects. Secondary education follows after this. Page 8 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 • Vocational training/education. This includes skills training, particularly on-the- job training. • Tertiary education. This includes domestic higher education institutes. • Foreign education. This includes students following tertiary education abroad or people purchasing online distance learning from abroad, and can be distinguished from tertiary education provided domestically 1.2.2 Overview of educational services in Vietnam In the feudal period, the education system of Vietnam was strongly influenced by the education feudal system of China. During the feudal-colonial France, education in Vietnam is influenced by education feudal and colonial France. From the revolution in August 1945 to 1975, education in the north of Vietnam is influenced by the education system of the Soviet Union. During the same period, education in the south of Vietnam was influenced by the American education system. From 1975 to 1986, education in Vietnam was influenced by the Soviet education system. From 1986 to the present, Vietnam has conducted the innovation education program, along with the renovation of the whole country.  1.3 The effects of Globalization on Education We will examine how the quantity, quality and type of human resources determine how countries can participate in globalization. It can be hypothesized that productive and competitive economies are more likely to participate successfully in globalization than those economies that are not. 1.3.1 Education and the ability to trade Education and skills development allow firms and people to take part in globalization processes such as exports of processed goods and global value chains. It is important to have a flexible education system in order to adjust to new trading conditions (complementary policy for successful globalization): while more advanced countries (especially East Asians) have been able to have an active national policy stance to promote education for exports (Korea is the prime example) some poorer countries have faced more difficulties adapting, probably due to less flexible education systems. Page 9 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 1.3.1.1 Education and exports at the macro level The HO( Heckscher- Ohlin) model- the main model employed by traditional trade theorist to understand trade flows- predicts that natural resources and labor forces will determine the comparative advantages of various nations, and thus lead to the economic specialization in those countries. Africa is abundant in low-skilled labor and land per person/worker and this determines its comparative advantage in international trade. Land abundance and lack of skilled labor explain Africa’s concentration on the export of unprocessed primary products. The econometric analysis suggests that the low skill/land ratio explains the low ratio of manufactured to primary exports in Africa relative to other groups of developing countries. Wood and Mayer are specific on the level of education helpful for achieving more exports. They argue that it is important to think about the appropriate mix of different levels and types of education. On the one hand, there is the need to provide everyone with good basic education, while on the other hand a minority needs to be equipped with relevant advanced skills. They cite the example of growth of forestry exports in Chile which was facilitated by the availability of forestry engineering graduates from local universities. There is less evidence of the effects of vocational training on exports. These effects are likely to depend on the specifics of the training. Many developing countries operate a levy on a firm’s payroll that can then be spent on approved training courses. Skill upgrading may occur in this way. However, there is no guarantee that training works for all, that quality is the same for each type of program, and that such training is aimed at unskilled or just the skilled workers with sufficient education. In some countries, training levies are voluntary and few graduates pass through approved training courses. It is important to realize that there is a long tradition of training institutes in Latin America and there may be more than in East Asia, where skill upgrading has been faster and more appropriate (e.g. the Singapore SDF [Skill Development Fund], and similar schemes in Malaysia),suggesting that the mere existence of such institutes is not sufficient. Indeed many institutions do not appear to Page 10 [...]... are beginning to participate in the globalization of services production Arora and Gambardella (2004) examine the expansion of the software industry in India, Ireland, Israel and Brazil The growth in the first three countries has been fuelled by exports whereas that of Brazil is rather based on the domestic market Among the factors explaining the growth is the expansion of defence R&D and the fast accumulation... shift in the distribution of skills and the demand for labour Galhardi shows evidence of increased skill content of labour in Korean manufacturing exports This is indicated by increases in the highest levels of educational attainment and the growth of certain occupations such managers, professionals, technicians and associated professionals Despite an increasing concentration on lessskilled intensive... skill-upgrading, benefiting particularly the educated workers 1.4.2.4 Micro supply of education and training – voluntary contributions MNEs affect the supply side of human resources through voluntary contributions, general education, official training and informal on- the- job training Informal on- thejob training is likely to correlate with the skill content of the job, and hence MNEs offer more of this when they... 1.4.3 The effects of Migration on Education Page 33 Website: http://www.docs.vn Email : lienhe@docs.vn Tel (: 0918.775.368 There are several effects of migration on the supply and demand for education Chart ** shows the main links that we need to assess for the effects of emigration on ‘sending’ countries: effects of emigration on the education sector, both directly and through macro effects, and on the. .. likely to introduce the latest technology requiring further training Thus, continued participation in export markets requires continuous skill upgrading through training There is also increasing interest in the impact of global value chains on upgrading of suppliers in developing countries Value chain governance influences how production capabilities in suppliers are upgraded Value chain analysis considers... types of upgrading (Kaplinsky and Morris, 2001) Process upgrading is associated with increases in the efficiency of production processes within or between stages of the value chain Product upgrading leads to improvement and introduction of products Functional upgrading changes the mix of activities and functions conducted within the value chain or firm (for example, taking responsibility for marketing and. .. functions further down the value chain However, other countries (e.g Central American countries) are locked into the upstream part of the value chain with few incentives (from lead firms lower down the chain) to upgrade 1.4.2 The effects of FDI on Education Chart * illustrates the links from FDI (inward) to education FDI can affect the demand and supply of education and training, and the effects are... value added; 77% of Rio Tinto businesses offer programmes to improve secondary school education 1.4.2.5 Micro supply – vocational training The involvement of MNEs in firm-specific and general vocational training is another way MNEs can affect the supply of skills This goes beyond charitable giving and is in the self-interest of firms There is evidence that MNEs provide more training than their local counterparts... become international companies by setting up campuses abroad, especially in developing countries Host country governments increasingly allow business education to be supplied by foreign companies inside their countries The growing internationalisation of business education can help the spread of best practice techniques and internationally recognised standards in business education International education... resources development and innovation capacity Targeted industrial policies can work in developing countries if they complement functional and horizontal policies and can be matched to the local environment While education and training policies were supportive of the automobile industry in general, they were never the main factor for attracting automobile investors in the first place Education is important in