The Philippines has the highest number of college graduates among developing Asian

countries, but that isn’t a substitute for quality .

The role of education in economic development is widely acknowledged: education increases

the innovative capacity of an economy and facilitates the diffusion, adoption, and adaptation of
new ideas. More specifically, education increases the amount of human capital available,
thereby increasing productivity and ultimately output.Education is especially important in a
rapidly evolving economic environment where a rapid rate of job destruction and creation might
otherwise lead to a gap between the skills demanded in the labour market and the skills of job-
seekers. So how can regional cooperation improve the quality and availability of – and access to
– education? The role of regional cooperation in a particular country and what means of
cooperation are viable will largely depend on that country’s position on the development ladder
and the status of its education sector. Since 1975 both GDP and education levels in China,
Indonesia, Malaysia, Thailand, and Vietnam have been catching up. Over the same period GDP
growth and improvements to education levels have been losing momentum in developed
countries including the United States, Canada, and New Zealand. The Philippines exhibits a
curious pattern in this respect, because even as the level of education attainment plateaued, its
GDP has been falling behind. This is an apparent contradiction. Given the well-established
beneficial effects of education on GDP and on GDP growth rates, the Philippines should have
witnessed an era of high growth since 1975, when it had the highest rate of completion of
tertiary education among developing Asian countries – higher than Japan, South Korea, Taiwan,
or Singapore. This suggests that the problem in the Philippines has been the quality of
education, rather than its availability or accessibility. Regional cooperation in education is often
identified with trade in education services. In the Asia Pacific, this most commonly takes the
form of direct exchanges of people, whether they be students from less-developed countries
going to study in more-developed ones, or, as in the case of Singapore and Malaysia,
academics from more-developed countries encouraged to relocate to universities in less-
developed countries by partnerships between the two institutions. Trade in education services
also takes place through transnational education, for example when foreign institutions are
encouraged to establish campuses in developing countries. Yet these forms of cooperation are
not the most appropriate for the Philippines – for instance because poor local infrastructure
makes it difficult to attract foreign institutions and academics. And, moreover, the principal effect
of these forms of education cooperation is to make education more available, when the problem
in the Philippines is the quality of education – not its availability. Regulatory reform is needed to
ensure that the quality of education received at home is high enough to give domestic Filipino
students access to education and work abroad. This reform process must start by establishing a
credible accreditation system, because under the current system of voluntary self-regulation,
less than 20 percent of higher education institutions in the Philippines are accredited. Forms of
international cooperation other than through trade in education services would allow the
Philippines to improve the quality of domestic education by following the example set by
Malaysia, which has linked its own accreditation system to international ones. Malaysia has also
been active in promoting the development of a regional quality assurance framework, the
ASEAN Quality Assurance Network (AQAN). The AQAN was organized in 2008 in order to
promote collaboration among quality assurance agencies in individual ASEAN countries.
Though the Philippines has not yet fully acceded to the AQAN, negotiations are underway to
formalize an agreement to adopt common standards in the education sector. The Philippines
can also pursue bilateral mutual recognition agreements. Such agreements should include
quality assurance on the part of both countries. In this way, even if the standards are not at the
same level as in higher-income countries, there will be pressure on some of the higher
education institutions in the Philippines to improve their programs and facilities in order to gain
accreditation. Such agreements, whether bilateral or as part of the AQAN, might make it easier
for Filipino policy makers to argue for domestic reform on the basis that it is necessary to meet
international agreements. With a higher-quality higher education system, the Philippines would
then be better placed to reap the well-documented economic benefits of an educated
population.