By THE NATION
The survey, published by ECA International, also found that Singapore has experienced a significant rise in the rankings, becoming the 12th most expensive location in the world for expatriates.
“We have seen the cost of living in Thailand increase over several years now. Bangkok especially has risen by over 100 places in the space of five years, and is now the 63rd most expensive location in our list,” Lee Quane, regional director for Asia at ECA International said yesterday.
“In doing so, it has moved into a category of relatively expensive locations in Asia. The city is now significantly more expensive than regional capitals including Jakarta, Kuala Lumpur and Manila. “Meanwhile, Singapore’s rise in our rankings is largely due to another strong year for the Singapore dollar.”
While increases in prices have been small over the past year, the strength of the Singapore dollar relative to other currencies makes Singapore the 12th most expensive location in the world and the sixth in Asia, overtaking Beijing, Busan and Yokohama from a year ago. This also marks the continuation of a longer-term trend, with Singapore rising 18 places since 2014 when it was 30th in the global rankings.
The ECA's Cost of Living Survey compares a basket of like-for-like consumer goods and services commonly purchased by international assignees in 482 locations worldwide. The survey helps businesses ensure that their employees’ spending power is maintained when they are sent on international assignments. Certain living costs, such as
accommodation rental, utilities, car purchases and school fees are usually covered by separate allowances. Data for these costs are collected separately and are not included in the ECA’s cost of living basket. ECA International has been conducting research into cost of living for over 45 years.
Hong Kong is now the fourth-most expensive location in the world for expatriates, up from 11th last year, and the second most expensive location in Asia. After being ranked in 28th place just five years ago, Hong Kong now sits only behind Ashgabat, Turkmenistan, and the Swiss cities Zurich and Geneva.
Hong Kong is now one of the top five most expensive locations for expatriates, primarily due to the continued strength of the Hong Kong dollar and relatively higher rates of inflation witnessed in the Chinese Special Administrative Region in the past 12 months. Prices in Hong Kong rose at a faster rate in the past 12 months compared to Tokyo, Shanghai and Seoul – all of which were ranked higher in our previous survey, Quane said.
The Chinese cities included in the rankings all remained fairly static, with none of the 14 locations moving more than four places. Shanghai was the only mainland Chinese city to feature in the global top 10, staying in 10th place.
“The Chinese yuan has been very stable compared to other currencies during the survey period. Inflation in tier-one cities such as Beijing and Shanghai has been much more moderate when compared to other Asian cities which are situated towards the upper end of our rankings,” Quane said.
“Prices have risen at a faster rate in tier-two locations, resulting in a narrowing gap in living costs for expatriate workers in tier-one and tier-two cities in the past year. This represents the continuation of a trend we have observed, with several developing cities such as Chengdu and Tianjin rising significantly in our rankings over the course of the past five years. All 14 of the Chinese cities in our rankings now feature in the global top 50, as compared to five years ago when there were only four.”
The location with the highest cost of living in the world was Ashgabat in Turkmenistan, which rose 110 places from last year.
Quane said that although the rise of Ashgabat in the rankings may be a surprise to some, those familiar with the economic and currency issues experienced by Turkmenistan over the past few years may have seen this coming. “Ever-escalating levels of inflation, coupled with a prominent illegal black market for foreign currencies have pushed up the cost of imports. This implies that the costs for visitors in Ashgabat, at the official exchange rate, have increased enormously – putting it firmly at the top of the rankings,” Quane said.
ECA International is a provider of knowledge, information and software for the management and assignment of employees.