Asian cities are the most expensive for expats

PETALING JAYA (June 22): Asian cities are the most expensive cities for expatriates, where five of the top 10 most expensive cities are in Asia, according to Mercer’s 2017 Cost of Living Survey.

Hong Kong (No. 2) is the most expensive Asian city for expats as a result for its currency pegged to the US dollar, which drove up the cost of accommodations locally. The global financial hub is followed by Tokyo (No. 3), Singapore (No. 5), Seoul (No. 6) and Shanghai (No. 8).

“The strengthening of the Japanese yen along with the high costs of expatriate consumer goods and a dynamic housing market pushed Japanese cities up in the ranking.

“However, the majority of Chinese cities fell in the ranking due to the weakening of the Chinese yuan against the US dollar,” said Mercer principal Nathalie Constantin-Metral.

Mercer is a global consulting firm in health, wealth and careers. The survey tracks over 400 cities across five continents and measures the comparative cost of more than 200 items in each location, including housing, transportation, food, clothing, household goods and entertainment. New York is used as the base city and all cities are compared against it.

While Australian cities have jumped up the global ranking since 2016 due to the strengthening of its currency. Sydney (No. 25) is the most expensive city for expats whole Melbourne (No. 46) and Perth (No. 50) went up 25 and 19 spots, respectively, compared to last year.

India’s most expensive city is Mumbai (No. 57), followed by New Delhi (No. 99) and Chennai (No. 135).

In Southeast Asia, Bangkok has climbed up seven spots to No. 67, while Jakarta (No. 88) and Hanoi (No. 100) have rose up five to six places, respectively. Kuala Lumpur is at No. 165.

Europe, Middle East and Africa

Three European cities made it to the top 10 list of ranking, where Zurich (No. 4) is the most costly European city for expats, followed by Geneva (No. 7) and Bern (No. 10).

Moscow (No. 14) and St Petersburg (No. 36) have climbed 53 and 116 places from 2016, respectively, due to strong appreciation of the ruble against the US dollar and the cost of goods and services.

According to the survey, London (No. 30), Aberdeen (No. 146) and Birmingham (No. 147) have dropped 13, 61 and 51 spots respectively, as a result of the weakening pound following the Brexit vote. Copenhagen is at No. 28 while Oslo and Paris are at No. 46 and No. 62 respectively.

Other Western European cities dropped in the rankings as well, mainly due to the weakening of local currencies against the US dollar. Vienna (No. 78) and Rome (No. 80) fell in the ranking by 24 and 22 spots, respectively. The German cities of Munich (No. 98), Frankfurt (No. 117), and Berlin (No. 120) dropped significantly as did Dusseldorf (No. 122) and Hamburg (No. 125).

In Middle East, Tel Aviv stays on as the most expensive city for expats, followed by Dubai (No. 20), Abu Dhabi (23), and Riyadh (No. 52). Cairo (No. 183), Jeddah (No. 117), Muscat (No. 92), and Doha (No. 81) are among the least expensive cities in the region.

“Egypt’s decision to allow its currency to float freely in return for a US$12 billion loan over three years to help strengthen its economy resulted in the massive devaluation of the Egyptian pound by more than 100% against the US dollar, pushing Cairo down the ranking,” said Constantin-Métral.

The survey noted that quite a few African cities continue to rank high, reflecting high living costs and prices of goods for expats. Luanda (No. 1) takes the top spot as the most expensive city for expatriates across Africa and globally despite its currency weakening against the US dollar. Luanda is followed by Victoria (No. 14), Ndjamena (No. 16), and Kinshasa (No. 18). Tunis falls six spots to rank 209 as the least expensive city in the region and overall.

Americas

Cities in the US are the most expensive locations in the Americas, with New York City (No. 9) ranked as the costliest city, followed by San Francisco (No. 22) and Los Angeles (No. 24).

Among other major US cities, Chicago (No. 32) is up two places, Boston (No. 51) down four places, and Seattle up seven places. Portland (No. 115) and Winston Salem (No. 140) remain the least expensive surveyed cities for expats in the US.

“Overall, US cities either remained stable in the ranking or have slightly increased due to the movement of the US dollar against the majority of currencies worldwide,” said Constantin-Métral.

In South America, Brazilian cities Sao Paulo (No. 27) and Rio de Janeiro (No. 56) surged 101 and 100 spots, respectively, due to the strengthening of the Brazilian real against the US dollar. Buenos Aires, ranked 40 followed by Santiago (No. 67) and Montevideo (No. 65).

Other cities in South America that rose on the list include Lima (No. 104) and Havana (No. 151). Dropping from 94th position, San Jose, Costa Rica (No. 110) experienced the largest drop in the region as the US dollar strengthened against the Costa Rican colon.

Up 35 places from last year, Vancouver (No. 107) has overtaken Toronto (No. 119) to become the most expensive Canadian city in the ranking, followed by Montreal (No. 129) and Calgary (No. 143). Ranking No. 152, Ottawa is the least expensive city in Canada.