What Demand Actually Looks Like

The enrollment numbers at many international schools across Asia look stable. Some show modest growth. The sector, read at a distance, appears healthy.

Read more carefully, the picture is more complicated — and the complications matter, because they are structural rather than cyclical.

Three demand stories have been running simultaneously across the region, and they are moving in different directions.

The first is Chinese outbound students. For most of the 2010s, families from mainland China were the fastest-growing component of international school enrollment across Southeast Asia. In Thailand, Malaysia, Vietnam, and Singapore, Chinese students became a meaningful share of total numbers at many schools. That flow has reversed. China's Ministry of Education data shows outbound student numbers at approximately 570,000 in 2025, down roughly 20 percent from the 2019 peak. The drivers are partly economic and partly political. Beijing's Patriotic Education Law, introduced in January 2024, explicitly frames overseas schooling as a threat to national identity. The schools that built capacity and programming around Chinese student demand are now managing a structural reduction, not a temporary dip.

The second story is corporate expats. The traditional demand engine for international schools — the multinational company relocating a senior employee, school fees covered by the package — has contracted. Localisation policies at major corporations, tighter mobility budgets, and the normalisation of remote work for some roles have all reduced the number of fully-packaged families entering the market. This is most visible in markets that were historically expat-heavy: Bangkok, Kuala Lumpur, Jakarta. The school that was 60 percent expat a decade ago may be 35 percent today.

The third story is local families. This is the demand that has, in most markets, replaced the first two. Across Thailand, local students now represent 70 to 80 percent of enrollment in many international schools. Similar patterns are visible in Malaysia, Vietnam, and Indonesia. The local middle class made a rational calculation: international education delivered outcomes that justified the fees, and they were prepared to stretch to access it.

This is good news for enrollment numbers. It is more complicated news for the underlying economics. The local family paying international school fees is, in most cases, making a significantly larger proportional commitment than the expat family whose employer covered the cost. That commitment is sensitive to two things: financial pressure on the household, and continued confidence in the outcome the fees are supposed to deliver. Both are under more pressure than the headline numbers show. Household debt levels across ASEAN have risen. The professional careers that international education was supposed to unlock are being reshaped by AI at exactly the entry-level positions the pipeline fed. The macro environment, with slower growth across the region and a more uncertain global outlook, is not making stretched household budgets more comfortable. This does not mean demand is collapsing. It means demand is shifting, and the schools best positioned for that shift are the ones that understand exactly who their families are, what those families are paying for, and whether the school is genuinely delivering it.

The ones least positioned are the ones still reading their enrollment figures and concluding that everything is fine.

Paideia Gamma is an international education advisory firm working with school owners, developers, and investors across Asia.