Seoul Walk

The objective of expatriate pay programs is to ensure that employee spending power and standard of living is maintained irrespective of global location. How to achieve this has been an issue many organizations spend considerable time on.

Exchange rates are volatile as they are based on short-term factors and are subject to substantial distortions from speculative movements, economic outlook and government interventions. In the short term, exchange rates, even when averaged over a period of time such as a year, are not a good measure of the comparative value of a salary in relation to its comparative international purchasing power. In the short to medium term at least, apparent changes in the comparative level of remuneration between one country and another may be principally a function of changes in the exchange rate.

A far better measure is salary purchasing power parity (SPPP) which is the amount of salary that equalizes the purchasing power of different currencies given the relative cost of the same basket of goods (cost of living) at the exchange rate versus one US Dollar. This means that a given salary, when converted into different currencies at the SPPP rates, will buy the same basket of goods and services in all countries.

The basket of goods and services used in SPPP calculations is derived on an International basis and includes certain items often excluded from expatriate cost of living data (most notably housing costs), however any or all of the 13 basket groups can be included or excluded from a calculation. SPPP’s provide a reasonably good picture of the differences in standards of living for individual’s resident and paid in different countries.

Internationally comparable data is crucial to forming sustainable expatriate pay policies and monitoring progress. Market exchange rates give misleading comparisons because they do not reflect salary purchasing power differences. Salary Purchasing Power Parities account for price differences between countries and so measure real quantities.

The ongoing impact of the credit crisis, slowing global economies, falling house prices, global stock market and exchange rate volatility, together with the US dollar and Euro strengthening against most currencies are all factors contributing to a major change in relative salary purchasing power, which can be seen from the global cost of living rankings as at January 2009.

London has already dropped from the most expensive place for expats to live to now rank 6th. New York has dropped to 50th but is now expected to begin to climb back up the ranking as the global recession impacts other parts of the world. Tokyo has reclaimed the title of the most expensive place in the world for expats in terms of salary purchasing power relative to all other international locations.

The salary purchasing power parity rank comprises cost of living indexes for each of 276 global locations. The indexes are calculated using the prices for specific quantities of the same goods and services in each location, based on expatriate spending patterns across 13 broad categories (Basket Groups).

The latest salary purchasing power parity ranking, together with the overall cost of living index, sourced from www.xpatulator.com as at January 2009 is as follows:

Rank Location (Overall Cost of Living Index New York=100)

1.Japan, Tokyo (126.03)
2.Norway, Oslo (123.74)
3.Denmark, Copenhagen (121.11)
4.Switzerland, Geneva (119.59)
5.Brazil, Brasilia (118.53)
6.United Kingdom, London (118.23)
7.Greenland, Nuuk (117.14)
8.Switzerland, Zurich (116.18)
9.Hungary, Budapest (114.36)
10.Russia, Moscow (113.41)
11.Nigeria, Lagos (112.69)
12.Ireland, Dublin (112.65)
13.New Caledonia, Noumea (112.43)
14.France, Paris (112.38)
15.Chad, N’Djamena (111.3)
16.Italy, Milan (111.19)
17.Cameroon, Douala (111.06)
18.Liechtenstein, Vaduz (110.89)
19.San Marino, San Marino (110.78)
20.Monaco, Monaco (109.83)
21.Czech Republic, Prague (109.81)
22.Austria, Vienna (109.68)
23.Slovakia, Bratislava (109.31)
24.Isle of Man, Douglas (108.97)
25.Poland, Warsaw (107.63)
26.Bermuda, Hamilton (107.53)
27.Italy, Rome (107.29)
28.Finland, Helsinki (107.07)
29.Australia, Sydney (106.52)
30.USA, San Francisco Calif (104.53)
31.Cote D’Ivoire, Abidjan (104.4)
32.Venezuela, Caracas (104.02)
33.China, Hong Kong (103.43)
34.United Arab Emirates, Dubai (103.36)
35.Croatia, Zagreb (103.29)
36.Angola, Luanda (103.27)
37.Belgium, Brussels (103.19)
38.Netherlands, Amsterdam (102.33)
39.Jersey, Saint Helier (102.24)
40.Papua New Guinea, Port Moresby (102.22)
41.Korea Republic of, Seoul (101.94)
42.Iceland, Reykjavík (101.66)
43.Ukraine, Kiev (101.2)
44.Guernsey, St Peter Port (100.68)
45.Qatar, Doha (100.64)
46.Central African Republic, Bangui (100.58)
47.Spain, Madrid (100.26)
48.USA, San Jose Calif (100.13)
49.Falkland Islands, Stanley (100)
50.USA, New York NY (100)
51.Sweden, Stockholm (99.76)
52.USA, Boston Mass (99.63)
53.Cameroon, Yaounde (98.84)
54.Mali, Bamako (98.74)
55.Benin, Cotonou (98.6)
56.Germany, Berlin (98.18)
57.Micronesia, Palikir (97.98)
58.Gabon, Libreville (97.77)
59.Canada, Toronto (97.39)
60.Germany, Bonn (96.38)
61.Vatican City, Vatican City (96.23)
62.Australia, Melbourne (95.88)
63.Australia, Canberra (95.88)
64.Estonia, Tallinn (95.08)
65.Turkey, Ankara (94.87)
66.Singapore, Singapore (94.6)
67.Guinea-Bissau, Bissau (94.24)
68.USA, Los Angeles Calif (93.93)
69.Palau, Melekeok (93.85)
70.Luxembourg, Luxembourg (93.77)
71.Canada, Vancouver (93.48)
72.Portugal, Lisbon (92.84)
73.Australia, Perth (92.82)
74.Germany, Frankfurt (92.81)
75.Azerbaijan, Baku (92.76)
76.Gibraltar, Gibraltar (92.33)
77.Comores, Moroni (92.04)
78.USA, Washington DC (91.8)
79.USA, Philadelphia Pa (91.49)
80.Nauru, Yaren (91.16)
81.Kazakhstan, Almaty (90.99)
82.Bahrain, Manama (90.82)
83.USA, San Diego Calif (90.7)
84.Bahamas, Nassau (90.63)
85.Togo, Lome (90.11)
86.Taiwan, Taipei (90.07)
87.Haiti, Port-au-Prince (90)
88.Senegal, Dakar (89.57)
89.Saint Helena, Jamestown (89.26)
90.USA, Baltimore Md (89.25)
91.United Kingdom, Glasgow (88.88)
92.Djibouti, Djibouti (88.45)
93.Niger, Niamey (88.38)
94.Zambia, Lusaka (88.36)
95.USA, Seattle Wash (88.3)
96.Andorra, Andorra la Vella (88.13)
97.Vietnam, Hanoi (88.03)
98.Tonga, Nuku’Alofa (87.34)
99.Gambia, Banjul (87.23)
100.United Arab Emirates, Abu Dhabi (87.16)
101.Cayman Islands, George Town (86.81)
102.Sudan, Khartoum (86.64)
103.Greece, Athens (86.59)
104.Barbados, Bridgetown (86.5)
105.USA, Portland Ore (86.1)
106.Sierra Leone, Freetown (85.92)
107.Equatorial Guinea, Malabo (85.89)
108.USA, Chicago Ill (85.73)
109.Romania, Bucharest (85.55)
110.USA, Miami Fla (85.54)
111.Marshall Islands, Majuro (85.41)
112.Cyprus, Nicosia (85.26)
113.Malta, Velletta (84.99)
114.Moldova, Chisinau (84.89)
115.Ghana, Accra (84.89)
116.United Kingdom, Birmingham (84.76)
117.Canada, Montreal (84.37)
118.Algeria, Algiers (84.01)
119.Israel, Jerusalem (83.82)
120.Australia, Brisbane (83.29)
121.Burkina Faso, Ouagadougou (82.92)
122.Lebanon, Beirut (82.74)
123.Jordan, Amman (82.41)
124.Guinea, Conakry (82.16)
125.Jamaica, Kingston (82.11)
126.Philippines, Manila (82.07)
127.Georgia Republic of, Tbilisi (82.03)
128.Congo Democratic Rep, Kinshasa (81.84)
129.Seychelles, Victoria (81.78)
130.Indonesia, Jakarta (81.76)
131.USA, Las Vegas Nev (81.75)
132.Lithuania, Vilnius (81.67)
133.Vanuatu, Port Vila (81.35)
134.Grenada, Saint George’s (81.23)
135.Trinidad and Tobago, Port-of-Spain (81.13)
136.Mozambique, Maputo (80.82)
137.New Zealand, Auckland (80.71)
138.Samoa, Apia (80.64)
139.Congo, Brazzaville (80.14)
140.Armenia, Yerevan (80.13)
141.Albania, Tirana (80.1)
142.Martinique, Fort-de-France (80.09)
143.Latvia, Riga (79.92)
144.Thailand, Bangkok (79.86)
145.Sao Tome and Principe, Sao Tome (79.79)
146.USA, Denver Colo (79.74)
147.China, Beijing (79.73)
148.Fiji, Suva (78.99)
149.Slovenia, Ljubljana (78.85)
150.Canada, Ottawa (78.82)
151.Tuvalu, Funafuti (78.78)
152.Myanmar, Yangon (78.51)
153.Puerto Rico, San Juan (78.49)
154.Kenya, Nairobi (78.4)
155.USA, Phoenix Ariz (78.26)
156.Mauritius, Port Louis (78.25)
157.Madagascar, Antananarivo (78.24)
158.USA, Tampa Fla (78.22)
159.Serbia, Belgrade (78.13)
160.Kiribati, South Tarawa (78.06)
161.Guam, Hagatna (77.8)
162.Brunei, Bandar Seri Begawan (77.72)
163.Uruguay, Montevideo (77.41)
164.Colombia, Bogota (77.23)
165.USA, Atlanta GA (76.99)
166.Morocco, Rabat (76.93)
167.USA, Milwaukee Wis (76.77)
168.Paraguay, Asuncion (76.49)
169.Mexico, Mexico City (76.13)
170.USA, Columbus Ohio (76.06)
171.India, Mumbai (76.04)
172.Tanzania, Dar es Salaam (76)
173.Solomon Islands, Honiara (75.93)
174.USA, Cleveland Ohio (75.84)
175.USA, Detroit Mich (75.74)
176.Liberia, Monrovia (75.63)
177.USA, Austin Tex (75.57)
178.USA, Dallas Tex (75.47)
179.USA, Jacksonville Fla (75.47)
180.Australia, Adelaide (75.39)
181.Kuwait, Kuwait City (75.22)
182.Bulgaria, Sofia (75.14)
183.Saudi Arabia, Riyadh (75.08)
184.USA, Pittsburgh Penn (74.54)
185.Timor-Leste, Dili (74.29)
186.Iran, Tehran (74.24)
187.USA, Indianapolis Ind (74.13)
188.USA, Fort Worth Tex (73.64)
189.Somalia, Mogadishu (73.49)
190.Maldives, Male (73.48)
191.USA, Charlotte NC (73.47)
192.USA, Houston Tex (73.36)
193.Chile, Santiago (73.01)
194.Mauritania, Nouakchott (72.99)
195.Botswana, Gaberone (72.86)
196.Cape Verde, Praia (72.81)
197.USA, El Paso Tex (72.61)
198.Uganda, Kampala (72.25)
199.Afghanistan, Kabul (72.13)
200.Antigua and Barbuda, Saint John’s (72.04)
201.USA, St Louis MO (71.93)
202.Malaysia, Kuala Lumpur (71.82)
203.Peru, Lima (71.7)
204.Korea Democratic Republic of, Pyongyang (71.62)
205.Kosovo, Pristina (71.55)
206.India, New Delhi (71.4)
207.Belarus, Minsk (71.28)
208.Malawi, Lilongwe (71.24)
209.Saint Kitts and Nevis, Basseterre (71.07)
210.USA, Memphis Tenn (71.02)
211.India, Chennai (70.76)
212.Kyrgyzstan, Bishkek (70.29)
213.Burundi, Bujumbura (70.07)
214.Macedonia, Skopje (70.02)
215.USA, San Antonio Tex (70.02)
216.Guatemala, Guatemala City (69.74)
217.Honduras, Tegucigalpa (69.57)
218.Saint Vincent and the Grenadines, Kingstown (69.5)
219.Canada, Calgary (69.46)
220.India, Calcutta (69.31)
221.India, Hyderabad (68.85)
222.Dominica, Roseau (68.79)
223.Rwanda, Kigali (68.75)
224.Panama, Panama City (68.58)
225.Guyana, Georgetown (68.58)
226.China, Shanghai (68.48)
227.Syria, Damascus (67.99)
228.Montenegro, Podgorica (67.75)
229.Laos, Vientiane (67.43)
230.Ethiopia, Addis Ababa (66.87)
231.Cuba, Havana (66.61)
232.Belize, Belmopan (66.33)
233.Nicaragua, Managua (65.89)
234.Nepal, Kathmandu (65.67)
235.Dominican Republic, Santo Domingo (64.93)
236.Tunisia, Tunis (64.87)
237.Suriname, Paramaribo (64.75)
238.India, Bangalore (64.56)
239.South Africa, Johannesburg (64.51)
240.Costa Rica, San Jose (64.47)
241.Egypt, Cairo (64.18)
242.El Salvador, San Salvador (63.34)
243.Swaziland, Mbabane (63.11)
244.Mongolia, Ulaanbaatar (62.85)
245.South Africa, Pretoria (62.71)
246.Oman, Muscat (61.61)
247.Saint Lucia, Castries (61.2)
248.Pakistan, Lahore (59.48)
249.Tajikistan, Dushanbe (59.25)
250.South Africa, Cape Town (58.99)
251.Namibia, Windhoek (58.89)
252.Sri Lanka, Colombo (58.51)
253.Pakistan, Islamabad (58.33)
254.Iraq, Baghdad (58.25)
255.Pakistan, Karachi (57.72)
256.Lesotho, Maseru (57.49)
257.Argentina, Buenos Aires (57.46)
258.Bangladesh, Dhaka (57.03)
259.Bhutan, Thimphu (56.78)
260.Bolivia, La Paz (56.66)
261.China, Macao (56.41)
262.South Africa, Durban (56.07)
263.Bosnia and Herzegovina, Sarajevo (54.35)
264.Ecuador, Quito (53.83)
265.Uzbekistan, Tashkent (53.03)
266.Libya, Tripoli (52.74)
267.China, Shenzhen (51.65)
268.Eritrea, Asmara (50.72)
269.China, Dalian (50.54)
270.China, Wuhan (49.93)
271.China, Guangzhou (47.28)
272.Cambodia, Phnom Penh (45.65)
273.Yemen, Sanaa (45.6)
274.Turkmenistan, Ashgabat (38.77)
275.China, Tianjin (29.5)
276.Zimbabwe, Harare (17.12)

International Cost of Living Rankings

International cost of living rankings are the result of comparing the cost of an expatriate’s personal budget, using the local prices for the same defined quantities of the same goods and services in each country throughout the world.

Our findings show that the compound impact of the multifaceted global economic trends that impact each country in one way or another, are contributing to rapid substantial changes in the relative cost of living of countries around the world. The changes in relative cost of living are large and have occurred in a relatively short period of time. The reason for this is due to the fact that so many economic crises are occurring simultaneously. 2008 saw the housing bubble burst followed by the failure of a number of global fund / asset management, insurance and banking giants. Some have been liquidated or taken over; others have been bailed out with government funds. In 2009 we have seen the continued fall in house prices which many believe have yet to bottom out. Stock prices and market indexes are down to levels last seen a decade or more ago. The trend towards decreased inflation and lower interest rates continues in developed and developing markets. We are also experiencing exchange rate volatility with a number of large economies seeing their currency weaken considerably in the past year. The economic impact is continuing to spread around the globe. We are currently seeing a truly global recession with reduced demand for manufacturing inputs and outputs as well as reduced energy demand and large scale job losses.

This study of 276 global locations covered every country in the world. The study comprised the cost of several hundred items that expatriates typically spend their pay on, grouped into 13 Basket Groups. The findings as at 1 April 2009 have been compared to the previous findings of 1 December 2008.  The Index uses New York as the base (New York = 100).  An index greater than 100, means that the cost of living is higher than New York, an index less than 100, means that the cost of living is lower than New York.

Geneva has a cost of living index of 110 for example. That means that on average, goods and services that cost $100 in New York, cost $110 in Geneva. Each city is ranked according to their overall cost of living index which includes the cost of all basket groups.

A cost of living index increases or decreases based on the local price of the goods and services used in the study and the ruling exchange rate. As a general principle, a country with a currency that has increased against other currencies (stronger currency) and which has relatively high local inflation (rapid/large price increases), will generally experience an increase in cost of living compared to other countries. On the other hand, a country with a currency that has decreased against other currencies (weaker currency) and which has relatively low local inflation will generally experience a decrease in cost of living compared to other countries.  It is important to note that we are talking about relative changes. Take London as another example. As recently as December 2008, London was still ranked the 6th most expensive place in the world for expatriates to live. As at April 2009 it is the 23rd most expensive place in the world for expatriates. That does not mean that the local cost of living for expatriates living in London has decreased. What it does mean is that relative to other places in the world, London is no longer as expensive as it was last year.  What makes London’s cost of living relatively lower than it was is mainly due to the increase in the cost of living elsewhere together with the weaker British Pound.

These relative changes have a substantial impact on expatriate employees. An expatriate working in a high cost of living - strong currency country such as Hong Kong where the Hong Kong Dollar is pegged to the US Dollar illustrates this point. The high cost of living makes it difficult to save due to high local prices; Household (Accommodation including utilities) in particular is very expensive. However, an expatriate working in Hong Kong will now likely find that remitting money back home provides greatly increased spending power at home.  In the past year the Hong Kong Dollar has increased 15% against the Malaysian Ringgit, and 30% against the Indonesian Rupiah and the Australian Dollar.

The Top 10 Most Expensive Places for Expatriates to Live

Tokyo has retained its status as the most expensive city in the world for expatriates to live. The cost of living index for Tokyo has increased from 126 in December 2008 to 143 as at 1 April 2009, and the Yen has strengthened against the US Dollar. At the other end of the scale, Harare has retained its status as the least expensive city in the world and is ranked 276 with an index of just 17 and a currency which is still in free-fall. Tokyo is ranked 1st for Healthcare expenses, 2nd for Groceries and 2nd for Household (Accommodation including utilities).

Hong Kong is now ranked 2nd overall having climbed from 33rd place in December 2008. Its cost of living index has increased from 103 to 121 and is ranked 1st for Household expenses and 2nd for Healthcare. It is interesting however to note that Hong Kong is not expensive in all categories. It is ranked 202nd for Alcohol & Tobacco, 226th for Recreation & Culture, 227th for Education, and 247th for Furniture & Appliances.

Lagos is the 3rd most expensive city in the world for expatriates, having previously been ranked 11th.  It is ranked 1st for Groceries and for Furniture & Appliance expenses, 6th for Healthcare, and 18th for Restaurants, Meals Out and Hotels. 

Caracas has moved substantially up the rankings to 4th, having been ranked just 32nd in December 2008. It is ranked 1st for Education expenses, 5th for Healthcare, and 6th for Household expenses (Accommodation including utilities).

Port Moresby in Papua New Guinea is the 5th ranked overall most expensive city for expatriates due to most goods and services being imported from Australia. Port Moresby is ranked 6th for Recreation & Culture, 7th for Communication and for Healthcare, and 8th most expensive for Clothing.

Geneva has dropped slightly to 6th, having been ranked 4th in December 2008.  It is ranked 3rd most expensive for Transport expenses, 11th for Recreation & Culture, 15th for Healthcare, and 20th for Clothing.

Dubai has moved into the top 10 most expensive places in the world for expatriates to live for the first time. Dubai is now ranked 7th, substantially up from 34th in December 2008. Its cost of living index has increased from 103 to 109 since December 2008. It is ranked 1st for Restaurants Meals Out and Hotel expenses, 6th for Clothing, 11th for Healthcare, and 16th for Groceries. Dubai is currently ranked 4th for Household expenses (Accommodation including utilities), however evidence is emerging that this will decrease significantly in the next quarter as it has been hit relatively hard in the property sector with falling property prices and rentals.

Doha has moved up in the global rankings faster than any other city. In December 2008, Doha was ranked the 45th most expensive city for expatriates, it is now 8th. The overall cost of living index has moved up from 101 to 109, equal to that of Dubai.  It is ranked 2nd for Restaurants, Meals Out and Hotel expenses, 3rd for Clothing, 7th for Household expenses (Accommodation including utilities), 8th for Groceries as well as for Recreation and Culture, and 10th for Healthcare.

Denmark has dropped slightly to being the 9th most expensive place in the world for expatriates, having been ranked 3rd in December 2008. It is ranked 3rd most expensive for Groceries, 5th for Transport, and 15th for Furniture and Appliances.   

Hamilton in Bermuda completes the top 10 moving from 26th in December despite the overall cost of index remaining 108. Hamilton is ranked 4th most expensive for both Education and Healthcare, 10th for Personal Care, 11th for Household expenses (Accommodation including utilities), and 15th for Groceries.  

The full overall cost of living ranking list, sourced from xpatulator.com as at 1 April 2009 is as follows: 

Rank and Location

1 Japan, Tokyo

2 China, Hong Kong

3 Nigeria, Lagos

4 Venezuela, Caracas

5 Papua New Guinea, Port Moresby

6 Switzerland, Geneva

7 United Arab Emirates, Dubai

8 Qatar, Doha

9 Denmark, Copenhagen

10 Bermuda, Hamilton

11 Angola, Luanda

12 Switzerland, Zurich

13 Russia, Moscow

14 Solomon Islands, Honiara

15 Cameroon, Douala

16 Chad, N’Djamena

17 Taiwan, Taipei

18 Liechtenstein, Vaduz

19 USA, New York NY

20 New Caledonia, Noumea

21 Greenland, Nuuk

22 Ireland, Dublin

23 United Kingdom, London

24 France, Paris

25 Norway, Oslo

26 Italy, Milan

27 San Marino, San Marino

28 USA, San Francisco Calif

29 Monaco, Monaco

30 Austria, Vienna

31 Bahamas, Nassau

32 Central African Republic, Bangui

33 Nauru, Yaren

34 USA, Boston Mass

35 Finland, Helsinki

36 Italy, Rome

37 Kazakhstan, Almaty

38 Cote D’Ivoire, Abidjan

39 Bahrain, Manama

40 Micronesia, Palikir

41 Isle of Man, Douglas

42 Haiti, Port-au-Prince

43 USA, San Jose Calif

44 Cameroon, Yaounde

45 Djibouti, Djibouti

46 Palau, Melekeok

47 Guinea-Bissau, Bissau

48 Azerbaijan, Baku

49 Benin, Cotonou

50 Slovakia, Bratislava

51 Belgium, Brussels

52 Netherlands, Amsterdam

53 Sao Tome and Principe, Sao Tome

54 Jersey, Saint Helier

55 Mali, Bamako

56 Gabon, Libreville

57 United Arab Emirates, Abu Dhabi

58 Croatia, Zagreb

59 Singapore, Singapore

60 Ghana, Accra

61 Spain, Madrid

62 Ukraine, Kiev

63 USA, Philadelphia Pa

64 Cayman Islands, George Town

65 Sierra Leone, Freetown

66 Germany, Berlin

67 Czech Republic, Prague

68 USA, San Diego Calif

69 Jordan, Amman

70 Trinidad and Tobago, Port-of-Spain

71 USA, Los Angeles Calif

72 USA, Washington DC

73 Estonia, Tallinn

74 USA, Baltimore Md

75 Falkland Islands, Stanley

76 Saudi Arabia, Riyadh

77 Guernsey, St Peter Port

78 Comores, Moroni

79 Sudan, Khartoum

80 Germany, Bonn

81 Vatican City, Vatican City

82 Canada, Toronto

83 Timor-Leste, Dili

84 Hungary, Budapest

85 USA, Seattle Wash

86 Brazil, Brasilia

87 Lebanon, Beirut

88 USA, Miami Fla

89 Vanuatu, Port Vila

90 Luxembourg, Luxembourg

91 Jamaica, Kingston

92 Australia, Sydney

93 Kuwait, Kuwait City

94 Moldova, Chisinau

95 Congo Democratic Rep, Kinshasa

96 Germany, Frankfurt

97 Tuvalu, Funafuti

98 Iceland, Reykjavík

99 Barbados, Bridgetown

100 Portugal, Lisbon

101 Mozambique, Maputo

102 Senegal, Dakar

103 Canada, Vancouver

104 Niger, Niamey

105 China, Beijing

106 Ethiopia, Addis Ababa

107 Turkey, Ankara

108 Togo, Lome

109 Equatorial Guinea, Malabo

110 Martinique, Fort-de-France

111 Armenia, Yerevan

112 USA, Chicago Ill

113 Liberia, Monrovia

114 Gibraltar, Gibraltar

115 Sweden, Stockholm

116 Somalia, Mogadishu

117 USA, Portland Ore

118 Israel, Jerusalem

119 Malta, Velletta

120 Puerto Rico, San Juan

121 Canada, Calgary

122 Rwanda, Kigali

123 Guam, Hagatna

124 Burkina Faso, Ouagadougou

125 Zambia, Lusaka

126 Andorra, Andorra la Vella

127 Cyprus, Nicosia

128 USA, Las Vegas Nev

129 Samoa, Apia

130 Saint Helena, Jamestown

131 Tanzania, Dar es Salaam

132 Greece, Athens

133 Poland, Warsaw

134 Maldives, Male

135 Malawi, Lilongwe

136 Thailand, Bangkok

137 Indonesia, Jakarta

138 USA, Jacksonville Fla

139 Antigua and Barbuda, Saint John’s

140 Gambia, Banjul

141 United Kingdom, Glasgow

142 Lithuania, Vilnius

143 Belarus, Minsk

144 USA, Dallas Tex

145 Australia, Canberra

146 India, Mumbai

147 Australia, Melbourne

148 USA, Denver Colo

149 Algeria, Algiers

150 Georgia Republic of, Tbilisi

151 Honduras, Tegucigalpa

152 USA, Atlanta GA

153 USA, Cleveland Ohio

154 Canada, Montreal

155 USA, Milwaukee Wis

156 Congo, Brazzaville

157 Guinea, Conakry

158 Saint Kitts and Nevis, Basseterre

159 USA, Detroit Mich

160 Panama, Panama City

161 Latvia, Riga

162 Uganda, Kampala

163 Korea Republic of, Seoul

164 USA, Charlotte NC

165 Marshall Islands, Majuro

166 Australia, Perth

167 USA, Phoenix Ariz

168 USA, Columbus Ohio

169 USA, Austin Tex

170 Madagascar, Antananarivo

171 USA, Tampa Fla

172 United Kingdom, Birmingham

173 Afghanistan, Kabul

174 Grenada, Saint George’s

175 Vietnam, Hanoi

176 USA, Indianapolis Ind

177 USA, St Louis MO

178 Saint Vincent and the Grenadines, Kingstown

179 Peru, Lima

180 Syria, Damascus

181 USA, Fort Worth Tex

182 Slovenia, Ljubljana

183 Mauritania, Nouakchott

184 USA, El Paso Tex

185 Philippines, Manila

186 China, Shanghai

187 USA, Memphis Tenn

188 USA, Pittsburgh Penn

189 Belize, Belmopan

190 India, New Delhi

191 Romania, Bucharest

192 Guatemala, Guatemala City

193 Iran, Tehran

194 Cape Verde, Praia

195 India, Chennai

196 USA, Houston Tex

197 Canada, Ottawa

198 Costa Rica, San Jose

199 Dominica, Roseau

200 Nicaragua, Managua

201 Guyana, Georgetown

202 Dominican Republic, Santo Domingo

203 Bulgaria, Sofia

204 237 Suriname, Paramaribo

205 Cuba, Havana

206 Oman, Muscat

207 India, Calcutta

208 Mongolia, Ulaanbaatar

209 Tajikistan, Dushanbe

210 India, Hyderabad

211 Burundi, Bujumbura

212 USA, San Antonio Tex

213 Myanmar, Yangon

214 Uruguay, Montevideo

215 Paraguay, Asuncion

216 Albania, Tirana

217 Brunei, Bandar Seri Begawan

218 Mauritius, Port Louis

219 Fiji, Suva

220 Egypt, Cairo

221 Australia, Brisbane

222 El Salvador, San Salvador

223 Korea Democratic Republic of, Pyongyang

224 Laos, Vientiane

225 Mexico, Mexico City

226 Morocco, Rabat

227 India, Bangalore

228 Saint Lucia, Castries

229 New Zealand, Auckland

230 Kiribati, South Tarawa

231 Kosovo, Pristina

232 Kenya, Nairobi

233 Serbia, Belgrade

234 Bangladesh, Dhaka

235 Pakistan, Lahore

236 Bolivia, La Paz

237 Colombia, Bogota

238 Botswana, Gaberone

239 Sri Lanka, Colombo

240 Pakistan, Islamabad

241 Turkmenistan, Ashgabat

242 Kyrgyzstan, Bishkek

243 Macedonia, Skopje

244 Pakistan, Karachi

245 Australia, Adelaide

246 Montenegro, Podgorica

247 Chile, Santiago

248 Malaysia, Kuala Lumpur

249 China, Macao

250 Eritrea, Asmara

251 Iraq, Baghdad

252 Argentina, Buenos Aires

253 Bosnia and Herzegovina, Sarajevo

254 Uzbekistan, Tashkent

255 Ecuador, Quito

256 Nepal, Kathmandu

257 Tunisia, Tunis

258 Yemen, Sanaa

259 Bhutan, Thimphu

260 South Africa, Johannesburg

261 China, Shenzhen

262 Tonga, Nuku’Alofa

263 China, Dalian

264 South Africa, Pretoria

265 Lesotho, Maseru

266 China, Wuhan

267 Namibia, Windhoek

268 Libya, Tripoli

269 South Africa, Cape Town

270 China, Guangzhou

271 Seychelles, Victoria

272 South Africa, Durban

273 Cambodia, Phnom Penh

274 Swaziland, Mbabane

275 China, Tianjin

276 Zimbabwe, Harare

International cost of living rankings are the result of comparing the cost of an expatriate’s personal budget, using the local prices for the same defined quantities of the same goods and services in each country throughout the world.

Our findings show that the compound impact of the multifaceted global economic trends that impact each country in one way or another, are contributing to rapid substantial changes in the relative cost of living of countries around the world. The changes in relative cost of living are large and have occurred in a relatively short period of time. The reason for this is due to the fact that so many economic crises are occurring simultaneously. 2008 saw the housing bubble burst followed by the failure of a number of global fund / asset management, insurance and banking giants. Some have been liquidated or taken over; others have been bailed out with government funds. In 2009 we have seen the continued fall in house prices which many believe have yet to bottom out. Stock prices and market indexes are down to levels last seen a decade or more ago. The trend towards decreased inflation and lower interest rates continues in developed and developing markets. We are also experiencing exchange rate volatility with a number of large economies seeing their currency weaken considerably in the past year. The economic impact is continuing to spread around the globe. We are currently seeing a truly global recession with reduced demand for manufacturing inputs and outputs as well as reduced energy demand and large scale job losses.

This study of 276 global locations covered every country in the world. The study comprised the cost of several hundred items that expatriates typically spend their pay on, grouped into 13 Basket Groups. The findings as at 1 April 2009 have been compared to the previous findings of 1 December 2008. The Index uses New York as the base (New York = 100). An index greater than 100, means that the cost of living is higher than New York, an index less than 100, means that the cost of living is lower than New York.

Geneva has a cost of living index of 110 for example. That means that on average, goods and services that cost $100 in New York, cost $110 in Geneva. Each city is ranked according to their overall cost of living index which includes the cost of all basket groups.

A cost of living index increases or decreases based on the local price of the goods and services used in the study and the ruling exchange rate. As a general principle, a country with a currency that has increased against other currencies (stronger currency) and which has relatively high local inflation (rapid/large price increases), will generally experience an increase in cost of living compared to other countries. On the other hand, a country with a currency that has decreased against other currencies (weaker currency) and which has relatively low local inflation will generally experience a decrease in cost of living compared to other countries. It is important to note that we are talking about relative changes. Take London as another example. As recently as December 2008, London was still ranked the 6th most expensive place in the world for expatriates to live. As at April 2009 it is the 23rd most expensive place in the world for expatriates. That does not mean that the local cost of living for expatriates living in London has decreased. What it does mean is that relative to other places in the world, London is no longer as expensive as it was last year. What makes London’s cost of living relatively lower than it was is mainly due to the increase in the cost of living elsewhere together with the weaker British Pound.

These relative changes have a substantial impact on expatriate employees. An expatriate working in a high cost of living - strong currency country such as Hong Kong where the Hong Kong Dollar is pegged to the US Dollar illustrates this point. The high cost of living makes it difficult to save due to high local prices; Household (Accommodation including utilities) in particular is very expensive. However, an expatriate working in Hong Kong will now likely find that remitting money back home provides greatly increased spending power at home. In the past year the Hong Kong Dollar has increased 15% against the Malaysian Ringgit, and 30% against the Indonesian Rupiah and the Australian Dollar.

The Top 10 Most Expensive Places for Expatriates to Live

Tokyo has retained its status as the most expensive city in the world for expatriates to live. The cost of living index for Tokyo has increased from 126 in December 2008 to 143 as at 1 April 2009, and the Yen has strengthened against the US Dollar. At the other end of the scale, Harare has retained its status as the least expensive city in the world and is ranked 276 with an index of just 17 and a currency which is still in free-fall. Tokyo is ranked 1st for Healthcare expenses, 2nd for Groceries and 2nd for Household (Accommodation including utilities).

Hong Kong is now ranked 2nd overall having climbed from 33rd place in December 2008. Its cost of living index has increased from 103 to 121 and is ranked 1st for Household expenses and 2nd for Healthcare. It is interesting however to note that Hong Kong is not expensive in all categories. It is ranked 202nd for Alcohol & Tobacco, 226th for Recreation & Culture, 227th for Education, and 247th for Furniture & Appliances.

Lagos is the 3rd most expensive city in the world for expatriates, having previously been ranked 11th. It is ranked 1st for Groceries and for Furniture & Appliance expenses, 6th for Healthcare, and 18th for Restaurants, Meals Out and Hotels.

Caracas has moved substantially up the rankings to 4th, having been ranked just 32nd in December 2008. It is ranked 1st for Education expenses, 5th for Healthcare, and 6th for Household expenses (Accommodation including utilities).

Port Moresby in Papua New Guinea is the 5th ranked overall most expensive city for expatriates due to most goods and services being imported from Australia. Port Moresby is ranked 6th for Recreation & Culture, 7th for Communication and for Healthcare, and 8th most expensive for Clothing.

Geneva has dropped slightly to 6th, having been ranked 4th in December 2008. It is ranked 3rd most expensive for Transport expenses, 11th for Recreation & Culture, 15th for Healthcare, and 20th for Clothing.

Dubai has moved into the top 10 most expensive places in the world for expatriates to live for the first time. Dubai is now ranked 7th, substantially up from 34th in December 2008. Its cost of living index has increased from 103 to 109 since December 2008. It is ranked 1st for Restaurants Meals Out and Hotel expenses, 6th for Clothing, 11th for Healthcare, and 16th for Groceries. Dubai is currently ranked 4th for Household expenses (Accommodation including utilities), however evidence is emerging that this will decrease significantly in the next quarter as it has been hit relatively hard in the property sector with falling property prices and rentals.

Doha has moved up in the global rankings faster than any other city. In December 2008, Doha was ranked the 45th most expensive city for expatriates, it is now 8th. The overall cost of living index has moved up from 101 to 109, equal to that of Dubai. It is ranked 2nd for Restaurants, Meals Out and Hotel expenses, 3rd for Clothing, 7th for Household expenses (Accommodation including utilities), 8th for Groceries as well as for Recreation and Culture, and 10th for Healthcare.

Denmark has dropped slightly to being the 9th most expensive place in the world for expatriates, having been ranked 3rd in December 2008. It is ranked 3rd most expensive for Groceries, 5th for Transport, and 15th for Furniture and Appliances.

Hamilton in Bermuda completes the top 10 moving from 26th in December despite the overall cost of index remaining 108. Hamilton is ranked 4th most expensive for both Education and Healthcare, 10th for Personal Care, 11th for Household expenses (Accommodation including utilities), and 15th for Groceries.

The full overall cost of living ranking list from Xpatulator as at 1 April 2009 is as follows:

RankLocation

1 Japan, Tokyo
2 China, Hong Kong
3 Nigeria, Lagos
4 Venezuela, Caracas
5 Papua New Guinea, Port Moresby
6 Switzerland, Geneva
7 United Arab Emirates, Dubai
8 Qatar, Doha
9 Denmark, Copenhagen
10 Bermuda, Hamilton
11 Angola, Luanda
12 Switzerland, Zurich
13 Russia, Moscow
14 Solomon Islands, Honiara
15 Cameroon, Douala
16 Chad, N’Djamena
17 Taiwan, Taipei
18 Liechtenstein, Vaduz
19 USA, New York NY
20 New Caledonia, Noumea
21 Greenland, Nuuk
22 Ireland, Dublin
23 United Kingdom, London
24 France, Paris
25 Norway, Oslo
26 Italy, Milan
27 San Marino, San Marino
28 USA, San Francisco Calif
29 Monaco, Monaco
30 Austria, Vienna
31 Bahamas, Nassau
32 Central African Republic, Bangui
33 Nauru, Yaren
34 USA, Boston Mass
35 Finland, Helsinki
36 Italy, Rome
37 Kazakhstan, Almaty
38 Cote D’Ivoire, Abidjan
39 Bahrain, Manama
40 Micronesia, Palikir
41 Isle of Man, Douglas
42 Haiti, Port-au-Prince
43 USA, San Jose Calif
44 Cameroon, Yaounde
45 Djibouti, Djibouti
46 Palau, Melekeok
47 Guinea-Bissau, Bissau
48 Azerbaijan, Baku
49 Benin, Cotonou
50 Slovakia, Bratislava
51 Belgium, Brussels
52 Netherlands, Amsterdam
53 Sao Tome and Principe, Sao Tome
54 Jersey, Saint Helier
55 Mali, Bamako
56 Gabon, Libreville
57 United Arab Emirates, Abu Dhabi
58 Croatia, Zagreb
59 Singapore, Singapore
60 Ghana, Accra
61 Spain, Madrid
62 Ukraine, Kiev
63 USA, Philadelphia Pa
64 Cayman Islands, George Town
65 Sierra Leone, Freetown
66 Germany, Berlin
67 Czech Republic, Prague
68 USA, San Diego Calif
69 Jordan, Amman
70 Trinidad and Tobago, Port-of-Spain
71 USA, Los Angeles Calif
72 USA, Washington DC
73 Estonia, Tallinn
74 USA, Baltimore Md
75 Falkland Islands, Stanley
76 Saudi Arabia, Riyadh
77 Guernsey, St Peter Port
78 Comores, Moroni
79 Sudan, Khartoum
80 Germany, Bonn
81 Vatican City, Vatican City
82 Canada, Toronto
83 Timor-Leste, Dili
84 Hungary, Budapest
85 USA, Seattle Wash
86 Brazil, Brasilia
87 Lebanon, Beirut
88 USA, Miami Fla
89 Vanuatu, Port Vila
90 Luxembourg, Luxembourg
91 Jamaica, Kingston
92 Australia, Sydney
93 Kuwait, Kuwait City
94 Moldova, Chisinau
95 Congo Democratic Rep, Kinshasa
96 Germany, Frankfurt
97 Tuvalu, Funafuti
98 Iceland, Reykjavík
99 Barbados, Bridgetown
100 Portugal, Lisbon
101 Mozambique, Maputo
102 Senegal, Dakar
103 Canada, Vancouver
104 Niger, Niamey
105 China, Beijing
106 Ethiopia, Addis Ababa
107 Turkey, Ankara
108 Togo, Lome
109 Equatorial Guinea, Malabo
110 Martinique, Fort-de-France
111 Armenia, Yerevan
112 USA, Chicago Ill
113 Liberia, Monrovia
114 Gibraltar, Gibraltar
115 Sweden, Stockholm
116 Somalia, Mogadishu
117 Portland Ore
118 Israel, Jerusalem
119 Malta, Velletta
120 Puerto Rico, San Juan
121 Canada, Calgary
122 Rwanda, Kigali
123 Guam, Hagatna
124 Burkina Faso, Ouagadougou
125 Zambia, Lusaka
126 Andorra, Andorra la Vella
127 Cyprus, Nicosia
128 USA, Las Vegas Nev
129 Samoa, Apia
130 Saint Helena, Jamestown
131 Tanzania, Dar es Salaam
132 Greece, Athens
133 Poland, Warsaw
134 Maldives, Male
135 Malawi, Lilongwe
136 Thailand, Bangkok
137 Indonesia, Jakarta
138 USA, Jacksonville Fla
139 Antigua and Barbuda, Saint John’s
140 Gambia, Banjul
141 United Kingdom, Glasgow
142 Lithuania, Vilnius
143 Belarus, Minsk
144 USA, Dallas Tex
145 Australia, Canberra
146 India, Mumbai
147 Australia, Melbourne
148 USA, Denver Colo
149 Algeria, Algiers
150 Georgia Republic of, Tbilisi
151 Honduras, Tegucigalpa
152 USA, Atlanta GA
153 USA, Cleveland Ohio
154 Canada, Montreal
155 USA, Milwaukee Wis
156 Congo, Brazzaville
157 Guinea, Conakry
158 Saint Kitts and Nevis, Basseterre
159 USA, Detroit Mich
160 Panama, Panama City
161 Latvia, Riga
162 Uganda, Kampala
163 Korea Republic of, Seoul
164 USA, Charlotte NC
165 Marshall Islands, Majuro
166 Australia, Perth
167 USA, Phoenix Ariz
168 USA, Columbus Ohio
169 USA, Austin Tex
170 Madagascar, Antananarivo
171 USA, Tampa Fla
172 United Kingdom, Birmingham
173 Afghanistan, Kabul
174 Grenada, Saint George’s
175 Vietnam, Hanoi
176 USA, Indianapolis Ind
177 USA, St Louis MO
178 Saint Vincent and the Grenadines, Kingstown
179 Peru, Lima
180 Syria, Damascus
181 USA, Fort Worth Tex
182 Slovenia, Ljubljana
183 Mauritania, Nouakchott
184 USA, El Paso Tex
185 Philippines, Manila
186 China, Shanghai
187 USA, Memphis Tenn
188 USA, Pittsburgh Penn
189 Belize, Belmopan
190 India, New Delhi
191 Romania, Bucharest
192 Guatemala, Guatemala City
193 Iran, Tehran
194 Cape Verde, Praia
195 India, Chennai
196 USA, Houston Tex
197 Canada, Ottawa
198 Costa Rica, San Jose
199 Dominica, Roseau
200 Nicaragua, Managua
201 Guyana, Georgetown
202 Dominican Republic, Santo Domingo
203 Bulgaria, Sofia
204 Suriname, Paramaribo
205 Cuba, Havana
206 Oman, Muscat
207 India, Calcutta
208 Mongolia, Ulaanbaatar
209 Tajikistan, Dushanbe
210 India, Hyderabad
211 Burundi, Bujumbura
212 USA, San Antonio Tex
213 Myanmar, Yangon
214 Uruguay, Montevideo
215 Paraguay, Asuncion
216 Albania, Tirana
217 Brunei, Bandar Seri Begawan
218 Mauritius, Port Louis
219 Fiji, Suva
220 Egypt, Cairo
221 Australia, Brisbane
222 El Salvador, San Salvador
223 Korea Democratic Republic of, Pyongyang
224 Laos, Vientiane
225 Mexico, Mexico City
226 Morocco, Rabat
227 India, Bangalore
228 Saint Lucia, Castries
229 New Zealand, Auckland
230 Kiribati, South Tarawa
231 Kosovo, Pristina
232 Kenya, Nairobi
233 Serbia, Belgrade
234 Bangladesh, Dhaka
235 Pakistan, Lahore
236 Bolivia, La Paz
237 Colombia, Bogota
238 Botswana, Gaberone
239 Sri Lanka, Colombo
240 Pakistan, Islamabad
241 Turkmenistan, Ashgabat
242 Kyrgyzstan, Bishkek
243 Macedonia, Skopje
244 Pakistan, Karachi
245 Australia, Adelaide
246 Montenegro, Podgorica
247 Chile, Santiago
248 Malaysia, Kuala Lumpur
249 China, Macao
250 Eritrea, Asmara
251 Iraq, Baghdad
252 Argentina, Buenos Aires
253 Bosnia and Herzegovina, Sarajevo
254 Uzbekistan, Tashkent
255 Ecuador, Quito
256 Nepal, Kathmandu
257 Tunisia, Tunis
258 Yemen, Sanaa
259 Bhutan, Thimphu
260 South Africa, Johannesburg
261 China, Shenzhen
262 Tonga, Nuku’Alofa
263 China, Dalian
264 South Africa, Pretoria
265 Lesotho, Maseru
266 China, Wuhan
267 Namibia, Windhoek
268 Libya, Tripoli
269 South Africa, Cape Town
270 China, Guangzhou
271 Seychelles, Victoria
272 South Africa, Durban
273 Cambodia, Phnom Penh
274 Swaziland, Mbabane
275 China, Tianjin
276 Zimbabwe, Harare

The US has become less expensive for expatriates relative to cities in Asia and Africa over the past year, says a cost of living comparison of 228 global cities.

The cost of living comparison prices goods and services that expatriates spend their salaries on, and reports indexes for 13 different basket groups using New York (100) as the base.

In terms of overall cost of living, New York is now the 28th most expensive global city and the 61st in terms of groceries. New York has dropped primarily due to the weakness of the US Dollar as well as the economic slowdown which appears to have slowed the increase in prices relative to other global cities.

The global cost of living comparison conducted by www.xpatulator.com shows London is the most expensive global location for expatriates, while 3 of the top 5 most expensive cities are in Asia, with Tokyo, Seoul, and Hong Kong ranked 2nd, 3rd, and 5th respectively in terms of overall cost of living.

Overall Cost of Living Comparison – Top 10

The 10 most expensive global cities for expatriates to live, based on overall cost of living (Index is in brackets) as at March 2008 are:

1. London, United Kingdom (126.63)

2. Tokyo, Japan (121.88)

3. Seoul, Republic of Korea (119.54)

4. Oslo, Norway (115.39)

5. Hong Kong, China (113.00)

6. Copenhagen, Denmark (112.63)

7. Moscow, Russia (110.35)

8. Geneva, Switzerland (110.06)

9. Hamilton, Bermuda (109.63)

10.Luanda, Angola (108.51)

This means that overall goods or services that cost USD$100 in New York, cost the equivalent of USD$126.63 in London, and USD$108.51 in Luanda.

Overall Cost of Living Comparison – Bottom 10

The bottom 10 (least expensive) cities for expatriates to live, based on overall cost of living (Index is in brackets) as at March 2008 are:

1. Harare, Zimbabwe (16.44)

2. Phnom Penh, Cambodia (44.89)

3. Sanaa, Yemen (44.95)

4. Dushanbe, Tajikistan (51.24)

5. Tripoli, Libya (53.22)

6. Quito, Ecuador (53.23)

7. Buenos Aires, Argentina (53.25)

8. La Paz, Bolivia (53.54)

9. Asmara, Eritrea (54.49)

10.Tashkent, Uzbekistan (56.06)

This means that overall, goods or services that cost USD$100 in New York, cost the equivalent of just USD$16.44 in Harare, and USD$53.54 in La Paz.

The cost of living varies from one location to another and by type of expense, mainly due to local supply and demand variations in each location. In some cities, groceries are more costly while accommodation is relatively less costly and vice versa.

In terms of groceries Seoul is the most expensive. Africa however has 6 of the 10 most expensive cities, Brazzaville, Accra, Lagos, Abidjan, Kinshasa, and Luanda.

Grocery Cost of Living Comparison – Top 10

The top 10 (most expensive) global cities for expatriates to live using the price of groceries as at March 2008 are as follows:

1. Seoul, Republic of Korea

2. Brazzaville, Congo

3. Ashgabat Turkmenistan

4. Accra, Ghana

5. Lagos, Nigeria

6. Copenhagen, Denmark

7. Abidjan, Cote D’Ivoire

8. Kinshasa Congo Democratic Rep

9. Luanda, Angola

10.Oslo, Norway

When establishing a salary for a global assignment it is essential that the items the expatriate will actually spend their salary on are included in the cost of living calculation. Similarly the items that are provided for the expatriate should be excluded from the cost of living calculation. If the incorrect items are included or excluded, large variations in the calculation of cost of living are likely. As an example London is ranked as the most expensive global location in terms of overall cost of living, but is only ranked 26th most expensive location for groceries.

Africa and Asia are becoming relatively more expensive than other global cities after lagging for decades; organisations need to factor this into expatriate pay calculations for global assignments.

The rank of all 228 global cities, in terms of overall cost of living, is on the website at http://www.xpatulator.com/main/cities/