Investment Opportunities In The Chinese Education Market

The Chinese education market size is around $300 billion in annual revenue, making it one of the most lucrative markets for investors. The whole industry has increased over the past few years, driven by a rising middle class and increased demand for education in China.

However, despite the numerous opportunities available, recent overnight regulatory changes are impacting stakeholders in many ways. Therefore, it is essential for investors to carefully consider these changes before making any investment decisions.

This EDU Blog will outline the major investment opportunities in the education market in China and provide insights into it.

How the Chinese education market is developing?

From 2017 and 2020, the education tech market in China proliferated. Its total revenue increased from $46.4 billion to $61.1 billion, growing by an average of 9.6% yearly. The country has made huge efforts to improve its education quality in recent years. The government has made education accessible to all citizens.

The government has introduced a series of reforms to increase education quality and boost enrollment rates. This has resulted in the booming of China’s education sector, with a growing number of private schools, tutoring centers, and online platforms.

With increasing Chinese education levels, Parents and students are seeking better education opportunities such as studying abroad. Many parents prefer to send their children to countries like the US, UK, and Europe.

This trend also has increased the demand for English language and test readiness training. They are also interested in obtaining certificates from foreign universities to improve job opportunities.

Simultaneously, there is increasing global interest in Chinese education, with many international students coming to study in China.

The Chinese government is also promoting its education industry abroad. With initiatives like the Belt and Road Education Action Plan, it aims to strengthen the education bond between China and other countries.

All these factors are because of the rapid growth of the China education industry.

What are the investment opportunities in Chinese education market?

Online education business: The online education market in China is rapidly growing.

Over the last five years, China has become a world leader in investing in EdTech, surpassing all other countries in this field since 2015. In 2020, China recorded a $10 billion investment directed towards EdTech, marking a significant milestone for the industry. (Data from Holon IQ).

With the advance of technology, it’s easier to access the internet for learners. Online education has become popular for students looking for flexible and low-cost learning. Investing in online education software or LMS systems can be a good choice for those who want to get involved in this growing industry.

Early childhood education: The education and care of young children are becoming more popular with good pricing. This is because of changes in government policies in China, and parents wanting more than just basic child care. The companies providing these services are doing well and can continue growing. Providing child care makes more money and has better chances for growth than just teaching.

STEAM training: In recent years, STEAM learning has become very popular in China.

STEAM stands for Science, Technology, Engineering, Arts and Maths. Many companies are now providing STEAM education resources to schools in China. Such education resources include high-tech tools like robotics, coding software, and 3D printers. These resources play an important role in making learning more engaging for students.

AI learning: As businesses and industries continue to rely more on AI technology, there are opportunities for investors to get involved and make a good return from this business sector.

Career and growth: As the demand for skilled workers is on the rise, more and more are looking for training programs to improve their skills and advance their careers. And nowadays, companies are more willing to spend budget on learning programs for their employees too.

There are a variety of training areas that businesses can focus on, such as IT, data analysis, leadership, and more. Investors can choose to invest in areas that specialize in a particular field or offer a broad range of training programs.

Education sector crackdown: The term “education sector crackdown” refers to a government initiative to regulate educational institutions closely. This crackdown may involve investigations or audits of schools. Institutions that have broken the regulations might revoke their license or receive penalties.

This crackdown ensures that students receive a high-quality education and are protected from immoral individuals or organizations.  

What is the market size of China Education Sector?

The Chinese education sector has been growing fast over the past few years, with an estimated market size of over $300 billion. This includes all levels of education, from early childhood education to university-level programs. With a population of over 1.4 billion people and a strong focus on education, the demand for education services is high in China.

Online education market in China

Online education has been rapidly growing in China’s market, as shown by the figures from Statista. The online education market in China is expected to reach about 433.1 billion yuan ($63.34 billion USD) by 2023.

Clearly, the online education market in China is expanding and will continue to do so in the coming years.

How much does China invest in education?

In 2020, China allocated about 4% of its GDP towards education, around 3.6 trillion yuan (about 550 billion US dollars). The government of China recognizes the

importance of education in driving the country’s economic growth and social development. The Chinese government provides wide access to education by building more schools, promoting educational programs, and increasing the number of teachers.

They also promote scientific and technological developments, which resulted in more universities and high-tech industries. China’s emphasis on education is a key factor in its great success in various fields. This benefits the people of China and continues to bring opportunities for education investors.

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