Singapore has returned to the global top 20 most expensive locations for expats as the 18th most expensive city in the world for expatriate workers. Within Asia, Singapore is the 9th most expensive location. This was one of the findings of the latest Cost of Living survey published by ECA International, the world’s leading provider of knowledge, information and software for the management and assignment of employees around the world.
In 2017, Singapore was the 21st most expensive city in the world for expatriates, up from 16th in 2016. Its 9th position within Asia remains unchanged since 2016.
“The Singapore dollar has performed strongly this year, resulting in a slight rise in Singapore’s rankings, up 3 places to become the 18th most expensive location in the world,” said Lee Quane, Regional Director – Asia for ECA International. “Singapore has long been considered one of the most expensive cities for expats to live and work in and this looks set to continue. However, the cost of living is still below that of other Asian locations with large expatriate populations such as Hong Kong, Tokyo, and Shanghai.”
ECA International has been conducting research into cost of living for more than 40 years. It carries out two main surveys per year to help companies calculate cost of living allowances so that their employees’ spending power is not compromised while on international assignment. The surveys compare a basket of like-for-like consumer goods and services commonly purchased by assignees in over 450 locations worldwide. 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 ECA’s cost of living basket.
Asia Pacific highlights
Hong Kong is now the second most expensive location in Asia for expatriate workers to live in, and sixth most expensive in the world. Quane said: “2018 was another strong year for the Hong Kong dollar, resulting in Hong Kong’s rise from ninth place last year to sixth, leapfrogging locations such as Tokyo and Oslo where the currencies have been slightly weaker.”
Thai cities were among the biggest risers in the rankings, with Bangkok rising 32 places and entering the top 100 most expensive locations for the first time. Quane said: “Over the past five years, Bangkok has climbed more than 80 places. The Thai capital now sits in 90th place in our cost of living rankings. The Thai baht has strengthened in recent years, as the economy has expanded and the political landscape has stabilised. This means that Thai locations are now significantly more expensive for expat workers than they have been in the past.”
While Malaysian cities have seen big rises in the cost of living rankings, all three of the surveyed locations still sit outside of the global top 150. Kuala Lumpur is the highest placed Malaysian city in the rankings and has risen 24 places to 188th. “Although the Malaysian cities in our survey have all seen significant rises of over twenty places each, Malaysia remains one of the cheapest locations in Asia for overseas workers. However, Kuala Lumpur is now more expensive for foreign workers than many of the locations that ranked higher in the 2017 rankings, such as New Delhi, Manila, and Mumbai,” said Quane.
In mainland China, all 14 of the Chinese cities surveyed by ECA remain in the global top 50, with Shanghai leading the way as the 14th most expensive location globally. Quane said: “Developing Chinese cities such as Dalian, Chengdu and Nanjing are now firmly established in the global top 50 alongside Beijing and Shanghai, and it is likely that they will remain expensive destinations for mobile employees in the foreseeable future.” Taipei, Taiwan’s most expensive city, and Macau also continued their rise in ECA’s rankings to 31 and 25 respectively – consolidating the upward trend in the cost of living in greater China relative to other locations globally.
The cost of living for overseas workers in Australia and New Zealand has plummeted since 2017, with every Australasian location included in the survey dropping at least 20 places. Sydney and Canberra both fell out of the top 50 and now sit in 70th and 85th respectively, whilst Adelaide’s ranking decreased the most, dropping from 64th most expensive location to 111th within a year. Quane said: “Both the Australian and New Zealand dollar deteriorated over the past year and were outperformed by other regional and global currencies. However, this is good news for expatriates living in these two nations., as these locations have become much less expensive overall. Australia and New Zealand are now significantly cheaper than several Asian cities that they once topped in the cost of living rankings.”
Ashgabat, capital city of the Central Asian nation of Turkmenistan, is the most expensive city in the world for expats. The city has rocketed from 146th in 2017 to the top spot amid a deepening economic crisis. Quane said: “A plunging black market exchange rate and foreign exchange shortages have stoked levels of inflation in Turkmenistan and have led the prices of goods to increase significantly over the past 12 months. A shortage of goods and hard currency means that it is now much more expensive for expatriate workers in Ashgabat to purchase the items and services that they normally would.”
In the Middle East, the cost of living rose across the board for overseas workers due to a combination of strong currencies and the introduction of Value Added Tax (VAT) in some Gulf states. Quane said: “Saudi Arabia and the UAE both introduced a 5 percent VAT at the beginning of this year which led to an increase in inflation. Increased inflation combined with a strong currency made these cities more expensive for many foreigners, with Dubai, Abu Dhabi, and Riyadh rising significantly in the rankings. Dubai is now among the top 50 most expensive locations for expatriates for the first time after jumping 24 places in the rankings.”
The only Middle Eastern location to buck this trend is Iran, which is now the cheapest location in the world for overseas workers. Quane said: “US sanctions have had a debilitating effect on Iran’s already fragile economy, and a devaluation of the currency has resulted in the cost of imported goods and services rising at an alarming rate. However, despite the rising prices, Iran is now cheaper overall for expatriates, as their money will now buy much more than it used to.”
In Europe, Swiss and Scandinavian cities continue to dominate the list for most expensive locations, with four Swiss cities and two Scandinavian cities featuring in the global top 10. Geneva is the most expensive location in Europe and second most expensive in the world, closely followed by Zurich, Basel and Bern – resulting in four of the top five most expensive cities in the world being in Switzerland.
Elsewhere, US cities increased across the board, as the resurgent US dollar drove prices back up after a dip in 2017. Five US cities featured in the global top 50 most expensive locations. New York is the most expensive US city, and ranks 24th globally.