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Education Industry

Brazil is regarded as one of the largest markets for investing in the education sector in the whole of South American continent. There are more than 70 million students in Brazil. Out of the 70 million students, approximately 93% of them are enrolled in receiving basic education and only 7% of the student population enroll themselves for undergraduate and postgraduate level education.

Only 8% of the students attain schools, which are run by the Brazilian government, and more than 19% of students enroll themselves in private schools. This huge difference is mainly because the there is a vast difference in the quality of education provided by the state-run and privately-run educational institutes.  The state-run quality schools have poor amenities, they lack quality teaching and non-teaching staff, and the curriculum taught in the government-run school is very basic and outdated.

As per the Higher Education census released by the Brazilian government in 2007, the country had about 2.281 higher educational institutes and a majority of these institutes are run by private players. This is mainly because the government of Brazil neither had the intention to invest in the higher education sector nor did it have the essential resources required to build an educational institute that provides top-class education.

Public education systems across the globe are coming under the hammer with severe competition coming from the private players. Several private investors are tactfully taking over the government funded educational institutions and are transforming them into privately funded profit-making organizations.

Brazil is no exception to this; the education system in Brazil has always been divided between the public and the private sector. However, due to the Brazilian government’s focus to develop other sectors of the country, the education industry in Brazil is bearing the dent. However, the neoliberal policies introduced by the International Monetary Fund (IMF) and World Bank following the debt crisis radically transformed the education system of Brazil. As a result, several private educational institutions have sprung up in different parts of Brazil.

The Brazilian government’s educational decentralization policy has been formulated in a way that it focuses on increasing the quality of education provided to the students of Brazil. As per the policy, the Brazilian government has transferred the schools’ resource management into private hands to gain efficiency. The government also ensures that the school principals are elected democratically and strictly on the basis the persons merits.

In order to attract foreign direct investment in the educational sector of Brazil the government provides tax benefits to investors. The Brazilian government provides the same protection to foreign capital investment as it gives to investments made by Brazilian locals. The Brazil government has also formulated favorable FDI policies to attract investments.

Thus, the favorable policies of the government and the huge student base, backed by the substandard education system, provide foreign investors a favorable ground to invest in the education industry of Brazil.