Singapore has fallen from 6th to 8th position in the rankings of the most expensive Asian locations for international assignees, according to the latest research conducted by
ECA International .
While the city remains above Hong Kong in the ranking, it has been overtaken by Beijing and Shanghai. Beijing has risen from 8th to 5th most expensive location in Asia while Shanghai has moved from 9th to 6th position.
Tokyo is still the most expensive location in the world and, within Asia, Japanese cities occupy the top four places.
Beijing's move up the global rankings has been particularly dramatic. The city is now the world's 20th most expensive city, up from 48th place in the same survey last year.
"The rate of increase in the prices of goods and services commonly purchased by assignees in China has gone up sharply in the past year," explained Lee Quane, Regional Director, Asia for ECA International.
Quane adds that the Renminbi has strengthened against major currencies. Together, these two factors have contributed to pushing up the cost of living in Chinese cities for international assignees significantly. For many companies the cost of posting employees to China has risen significantly compared to those posting employees to Singapore, Hong Kong and other locations in the region.
Despite falling in the Asia ranking, Singapore has continued its rise up the global ranking. The city is in 32nd position, up from last year's 38th position and the previous year's 69th place. It is higher in the ranking now than cities such as Berlin (47) and Paris (34).
“Prices of goods and services in our basket of items commonly bought by international assignees in Singapore have increased almost 6 per cent on average in the last twelve months, says Quane. “This is almost double the rate at which they rose a year ago. This together with the fact that over the same period the Singapore dollar has remained strong against other major currencies has contributed to Singapore’s continued rise up the global ranking.”
Living costs for assignees are affected by inflation, availability of goods and exchange rates, all of which can have a significant impact on assignee remuneration packages. Certain living costs such as accommodation, utilities, car purchase and school fees are not included in the survey. Such items can make a significant difference to expenses but are usually compensated for separately in expatriate packages.
Cost of living in Asia on the rise
In Asia as a whole, the price of goods and services commonly purchased by expatriates has risen by just over 6 per cent on average – slightly higher than the 4 per cent increases witnessed a year ago. While Japan has seen the smallest price increases in the region, Tokyo is still the most expensive location in Asia - and the world - for international assignees.
Globally, the rapid rise of Beijing and Shanghai have seen both cities overtake a number of locations in Australia, Brazil, Europe and the United States, including Rio de Janeiro (31st), Paris (34th) and Manhattan (40th).
Locations across mainland China have also climbed up the ranking and second-tier cities Shenzhen and Guangzhou now sit just behind Hong Kong at 10th and 11th place respectively in the Asian rankings and 55th and 56th in the global ranking. For the first time, both cities are now more expensive than Central London (at 62nd place), along with Beijing, Shanghai and Hong Kong.
Like Singapore, Hong Kong is now below Beijing and Shanghai in the ranking and has dropped from 7th to 9th position within Asia. However, the city has climbed back up the global ranking, following last year's falls. Hong Kong is the 36th most costly location globally up from last year's 47th position and almost back to the 34th place it held two years ago.
The most expensive of the Indian cities for international assignees is New Delhi, ranked 209th globally. It is followed by Mumbai (212) and Bangalore (231).
Karachi, ranked 256th, is the least costly location in Asia, and in the survey.
Australasia
Australian locations have maintained their positions towards the top of the ranking, with all those surveyed now within the top 25 globally. Prices there continue to rise and the Australian dollar remains strong against other major currencies. Sydney (16th globally) is the most expensive, followed by Canberra (17th) and Adelaide (18th).
Locations in New Zealand have seen greater movements up the ranking. Auckland has gained 44 places year-on-year and is now ranked 38th. This is largely a result of the New Zealand dollar strengthening against major currencies, making it more expensive for people coming into the country.
Europe
Norwegian and Swiss locations dominate the list of most expensive European locations. Oslo, ranked 2nd in the global ranking, is the most costly followed by Stavanger (5th), Geneva (7th), Zurich (9th) and Bern (10th).
Almost all locations across the continent have fallen in the ranking year-on-year, largely as a result of the Euro and other European currencies falling against the US dollar and other major currencies between surveys.
Within the region, Zagreb has dropped the most places in the ranking. The Croatian capital dropped 48 places to 149th position. The Czech city of Prague also fell significantly, dropping from 132nd to 178th position.
The Hungarian and Turkish currencies were among the European currencies that have fallen in value the most, making living costs lower for international assignees in Budapest and Istanbul, despite a rise in the rate of increase of the prices of goods and services there. The cost of living in badly-effected Greece and Spain has fallen in the ranking. Athens is now in 72nd position and Madrid in 83rd.
This year's Olympic city, London, has fallen nine places to 62nd place globally. A number of locations in China and New Zealand are now higher in the global ranking.
Americas
Caracas, ranked 12th globally, is the most expensive location in the Americas. The Venezuelan capital is followed by Rio de Janeiro (31st) and Sao Paulo (36th). Despite being ranked among the most expensive locations in the region, these Brazilian locations have fallen in this survey's ranking. Slower price inflation than the previous year, coupled with a weakening of the Real against the US dollar have contributed to these falls.
Within the region, cost of living for international assignees has fallen most in Mexican cities.
Mexico City has fallen 18 places and is currently ranked 223rd in the global ranking. Prices are increasing at half the rate they were a year ago. In addition, the Mexican Peso has weakened against major currencies.
Buenos Aires is the location that has risen the most in the region and among one of the highest climbers in the global survey. It has jumped 66 places, now sitting in 71st position. While the Argentine Peso has weakened against the US dollar and other major currencies, extremely high price inflation has negated any decrease in the cost of living for international assignees in Argentina.
The prices of items in the basket of goods and services have continued to rise considerably: in the last 12 months, they rose almost 29 per cent on average.
Ottawa has overtaken Vancouver as the most expensive North American location and is ranked 39th globally. New York's Manhattan (40th) follows.
Africa and Middle East
The Angolan capital Luanda, ranked 4th globally, remains Africa's most expensive location for international assignees, followed by Brazzaville (27th) in Congo. The need to import and transport many of the goods and services typically purchased by expatriates into these locations where infrastructure is poor pushes costs up.
However, there are large disparities across the continent, with many locations among the least expensive surveyed. Maseru in Lesotho, ranked 255th, is the cheapest of the African locations and is also one of the lowest ranked locations globally.
Tel Aviv (33rd globally) is the Middle East's most costly location. Other locations in the region rank much further down, with Dubai in 187th place. The region's least expensive locations are in Saudi Arabia, with Jeddah ranked 250th.
Orignal Author:
CFO Innovation Asia Staff
Related articles
0 comments
Print
Digg