Ashgabat, the capital of Turkmenistan, Hong Kong, and Beirut are this year’s most expensive cities in the world for overseas workers, according to survey results from global consulting firm Mercer. Hong Kong fell from the number one spot last year while Beirut jumped 42 spots to third as a result of ‘the expansion of several crises – the country’s largest financial crisis, the Covid-19 crisis and the Port of Beirut explosion in 2020’, Mercer said yesterday.
In this year’s most expensive cities, Asian cities make up more than half. Tokyo and Zurich have both dropped one place to fourth and fifth, respectively, while Shanghai has risen one spot to sixth. According to Mercer, Singapore moved up from fifth place to seventh. Geneva rounded out the top 10, followed by Beijing and Bern.
Over 200 items including housing, transportation, and food are measured in the ranking of 209 cities. The ranking shows how Covid-19 has shaken up the index as countries continue to grapple with the economic fallout of the pandemic. In Dubai and Abu Dhabi, however, the cost of living has fallen as a result of the UAE’s diversification, which has softened the blow of low oil prices on the gross domestic product, according to Mercer.
A year ago, Dubai was ranked 23rd; but during this year’s survey period, it fell from 42nd to 56th place. The UAE was helped by Dh388 billion worth of economic support to rebound from a pandemic-driven slowdown. Government initiatives, including the 10-year golden visa program and retiree visas, have also contributed to the improvement in investor confidence.
This survey helps employers determine the cost of international assignments for employees, which is affected by such factors as currency fluctuations, inflation for goods and services, and accommodation costs.’Cost of living has always been a factor in international mobility planning, but the pandemic has added a whole new layer of complexity, along with long-term implications for health and safety of staff and flexible policies,’ Mercer’s career president Ilya Bonic told us recently.
The world’s cheapest city is Bishkek in Kyrgyzstan, followed by Lusaka in Zambia and Tbilisi in Georgia. The city of Riyadh was ranked the 29th most expensive in the GCC, up to two places from last year. The capital of Saudi Arabia, Jeddah, moved from 104th to 94th, Bahrain’s Manama dropped 19 spots to 71st, and the Omani capital, Muscat, dropped 12 spots to 108th. Kuwait City dropped two spots to 115th, while the capital of Qatar, Doha, dropped 21 spots to 130th, according to the survey. Despite rising costs of goods and services, the weak dollar drove down costs for overseas workers in the US. The most expensive city in the US was New York, followed by Los Angeles, San Francisco, Honolulu, and Chicago, according to a Mercer survey.
Several European cities climbed up the rankings as a result of a stronger euro, including Paris, which jumped to 33rd place. With a gain of one and eighth places, respectively, London (18) and Birmingham (121) remained steady, Mercer reported. ‘UK cities have remained relatively stable in the ranking this year due to low inflation and the strength of the pound against all major currencies during the pandemic,’ said Kate Fitzpatrick, Mercer’s global mobility practice leader for the UK and Ireland.
The report also shows that Mercer’s index places Mumbai in India’s top spot despite the city’s drop of 18 places this year because of a relatively weak Indian rupee compared to the rest of the top 20. As the Australian dollar rose against the US dollar, Australian cities climbed in the index this year. Melbourne climbed 40 spots into 59th place, followed by Sydney which increased 35 spots to reach 31st on the index.
The 10 most expensive cities in 2021 are:
- Hong Kong