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Hong Kong back in the top ten most expensive locations for expatriates

  • Hong Kong is the world’s ninth-most expensive location for expatriates, after dropping out of the top ten in 2016.
  • Hong Kong is now the second-most expensive location in the Asia-Pacific region after Tokyo, Japan.
  • Asian cities dominate the list of top 50 most expensive locations, making up over half the entries.

Hong Kong is once again one of the top ten most expensive locations in the world for expatriates, ranking ninth out of over 260 cities included in our rankings.

This was one of the findings in 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.

Hong Kong has risen two places on the list and is back in the top ten after dropping out in the 2016 survey. Over the past five years*, Hong Kong has risen steadily up the global rankings to become one of the most expensive locations for international employees to live and work in.

“Although Hong Kong briefly dropped out of the top ten last year, it has risen in the ECA global rankings over the past five years. Hong Kong has now overtaken cities in Japan to reclaim its place in the top ten most expensive locations,” said Lee Quane, Regional Director – Asia, ECA International. “It now has the second highest cost of living of any city in the Asia-Pacific region, only behind Tokyo, up from fifth this time last year. Faster rates of price increases in Hong Kong combined with a strengthening of the dollar against the yen both contributed to Hong Kong leapfrogging many of the Japanese locations that were ranked above it last year.”

ECA International has been conducting research into cost of living for over 45 years. It carries out two cost of living 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 262 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 – Asian cities dominate the top of the table

Asian cities lead the way as the most expensive locations to live in, with over half of the top 50 most expensive locations surveyed this year being in Asia. A total of 26 of the top 50 entries were Asian cities, with 14 Chinese cities alone featured on the list. This compares with just four EU cities and three US making it into the top 50. 

In Japan, Tokyo has fallen seven places and relinquished the global top spot in the process – falling to eighth in the table. Despite this, Tokyo remains the most expensive location for expatriates in the Asia Pacific region. Other Japanese cities have performed similarly - with Yokohama, Nagoya and Osaka all dropping out of the top ten.

Quane said, “Japanese cities have dropped in the rankings as the yen has weakened in the last year. However, with four cities in the global top 20 Japan is still an expensive place for expatriates.”

Taiwanese cities on the other hand continue to rise through the rankings with Taipei and Kaohsiung 33rd and 45th respectively. This is a dramatic rise when compared with five years ago when Taipei was ranked 66th most expensive location and Kaohsiung not even in the top 100. 

Singapore has fallen in the rankings and is now the 21st most expensive city surveyed. This is the first time since 2014 that Singapore has not featured in the top 20. 

Asia is also home to some of the cheapest locations in the ranking table, with Ulaanbaatar claiming the status as Asia’s cheapest location. “This highlights the curiosity of managing the movement of people in Asia for many companies and their HR departments,” added Quane. “Asia is home to some of the world’s most expensive locations as well its cheapest. This level of variety is only matched in Africa which is home to both the world’s most expensive location and its cheapest.” 

Ulaanbaatar is joined by Johor Bahru, George Town (Penang), Yangon and Karachi in making up the cheapest locations in Asia, with all locations falling in our global rankings over the past 12 months. 

Elsewhere in Asia, the newly introduced GST tax in India seems to have had little impact on the cost of living in Indian cities. All Indian locations that were surveyed have risen slightly from their positions in the 2016 survey, but the highest-placed remains New Delhi in 166th.

Quane said, “When a new tax is introduced prices do not always rise overnight. The introduction of national goods and services tax in India to replace a range of central and state taxes seems to have had little impact on the costs overall.”

Global highlights – Luanda returns to the top spot, Khartoum rises over 200 places in five years and UK cities continue to fall 

Luanda has returned to the top of ECA’s global rankings this year. The Angolan capital has been consistently in the top five most expensive cities since 2012.

“The cost of goods typically purchased by international assignees in Luanda, which was already high due to poor infrastructure and high oil-fuelled demand, continues to be pushed even higher. The Angolan kwanza is increasingly overvalued, which pushes up relative costs; while the ongoing weakness of the black-market exchange rate has also inflated the price of imported goods.” Added Quane.

Khartoum, Sudan, is up to second place on the list of most expensive cities and has risen by 224 places in just five years, as currency shortages and rising prices continue to take effect on the African nation.

Central London has slipped down the rankings and is now the 139th most expensive location for expatriates, down 36 places on the 2016 survey and falling 78 places in five years. Other UK cities have shown the same trend, with the next most expensive cities, Edinburgh and Manchester, dropping to 163rd and 173rd respectively. 

 
Top 20 most expensive locations in Asia-Pacific region
Location
2017 ranking
2016 ranking
Tokyo
1
1
Hong Kong
2
5
Seoul
3
6
Shanghai
4
7
Beijing
5
8
Yokohama
6
2
Nagoya
7
3
Osaka
8
4
Singapore
9
9
Busan
10
10
Guangzhou
11
11
Ulsan
12
12
Macau
13
13
Shenzhen
14
14
Taipei
15
15
Chengdu
16
17
Dalian
17
16
Qingdao
18
21
Nanjing
19
18
Xi'an
20
22
 
 
Global top 20 most expensive locations
Location
2017 ranking
2016 ranking
Luanda
1
2
Khartoum
2
21
Zurich
3
3
Geneva
4
4
Basel
5
6
Bern
6
8
Oslo
7
14
Tokyo
8
1
Hong Kong
9
11
Stavanger
10
20
Seoul
11
12
Shanghai
12
13
Tel Aviv
13
19
Copenhagen
14
23
Jerusalem
15
22
Beijing
16
15
Kinshasa
17
10
Yokohama
18
5
Nagoya
19
7
Osaka
20
9
 
-ENDS-
 
Notes to Editors

* Please note that when ‘five years’ is referenced in the text this is referring to the period between ECA’s September 2012 and September 2017 surveys. 

Figures used in this release were taken from ECA's September 2017 Cost of Living Survey. 

About ECA International

ECA International is the market-leading provider of knowledge, information and technology that enables businesses to manage their international reward programmes.

Partnering with thousands of clients on every continent, we provide a fully-integrated suite of quality data, specialist software, consultancy and training. Our unparalleled insights guide clients as they mobilise their most valuable resource: people.
 
We make the complex world of international mobility simple, providing clients with the expertise and support they need to make the right decisions - every time.
 
ECA International: Mobility solutions for a world that’s constantly moving.

About ECA's Cost of Living Survey

ECA International's main cost of living surveys are carried out in March and September using a basket of day-to-day goods and services commonly purchased by assignees. The data used above refers to year-on-year movements between ECA's September 2012 to 2017 surveys. ECA’s cost of living survey rankings began in 2004.

Cost of living indices are used by ECA’s clients to calculate cost of living allowances for assignees. The survey covers:

Food: Groceries; dairy produce; meat and fish; fresh fruit and vegetables 
Basic: Household goods; recreational goods; general services; leisure services
General: Clothing; electrical goods; motoring; meals out; alcohol and tobacco

Certain living costs such as accommodation rental, utilities charges (electricity, gas, and water), car purchases 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.

This comparison of cost of living was calculated on a base composed of various developed countries and is used to reflect an international lifestyle. Other indices available from ECA reflect specific city-to-city comparisons, and different levels of shopping efficiency.

ECA's blog provides updates and commentary on currency, inflation and expatriate cost of living. Follow the blog here.

For further information, please contact:
Lee Quane (Hong Kong)
ECA International
Regional Director - Asia
Tel: +852 2121 2388
lee.quane@eca-international.com

 
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