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Hong Kong now the most expensive location in East Asia for expatriates

  • Hong Kong is the second most expensive location in Asia for expatriates to live, behind only Ashgabat, and sixth most expensive globally
  • Tokyo overtaken and now fourth most expensive location in Asia, down from first
  • Singapore is back into the global top 20 most expensive locations, after dropping out in 2017

Hong Kong is now the second most expensive location in Asia for expatriate workers to live, and sixth most expensive in the world. 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.

“Hong Kong has continued to rise in our cost of living rankings in recent years and is now the sixth most expensive location in the world for expatriates” said Lee Quane, Regional Director - Asia for ECA International. “2018 was another strong year for the Hong Kong dollar and this has seen it rise from ninth overall last year to sixth, leapfrogging locations such as Tokyo and Oslo where the respective currencies have been slightly weaker.”

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 highlights

In mainland China, all 14 of the Chinese cities surveyed by ECA remain in the global top 50, with Shanghai leading the way as 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 for 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.

Elsewhere, Hong Kong’s regional rival Singapore returned to the global top 20 most expensive locations for expats, after briefly dropping out last year.

“The Singapore dollar has performed strongly this year, making the city state more expensive for visitors and overseas workers. This has resulted in a slight rise in the rankings, up three places to become the 18th most expensive location in the world. 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 expat populations such as Hong Kong, Shanghai and Tokyo” explained Quane. 

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 over 80 places and 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 a great deal more expensive for expat workers than they have been in the past.”

Malaysian cities have seen big rises in the cost of living rankings, however 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 most expensive location.

“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 expatriates than many of the locations that sat above them in the 2017 rankings, such as New Delhi, Manila and Mumbai” said Quane.

Global highlights

Ashgabat, capital city of the Central Asian nation of Turkmenistan, is the most expensive city in the world for expats according to ECA’s survey. The city has rocketed up from 146th in 2017 to take the top spot amid a deepening economic crisis.

Quane said “A plunging black market exchange rate, coupled with foreign exchange shortages, have stoked the levels of inflation in Turkmenistan and have led the prices of goods to increase enormously over the past twelve 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, which combined with a strong currency making the cities more expensive for many foreigners, saw cities such as Dubai, Abu Dhabi and Riyadh rise significantly in the rankings. Dubai is now in the top 50 most expensive locations for expatriates the first time after jumping 24 places in the rankings.”

The only Middle Eastern location to buck this trend is Iran, which found itself bottom of the ECA rankings and is now the cheapest location in the world for overseas workers. 

Quane explained “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 the country 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 ten. 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, with New York the most expensive in 24th place. 

Top ten most expensive locations - Asia
Location
2018 Asia ranking
2018 global ranking
2017 global ranking
Ashgabat, Turkmenistan
1
1
146
Hong Kong
2
6
9
Seoul, Korea Republic
3
7
11
Tokyo, Japan
4
8
8
Busan. Korea Republic
5
13
23
Shanghai, China
6
14
12
Yokohama, Japan
7
15
18
Nagoya, Japan
8
17
19
Singapore
9
18
21
Osaka, Japan
10
19
20
Top ten most expensive locations – Global
Location
2018 ranking
2017 ranking
Ashgabat, Turkmenistan
1
146
Geneva, Switzerland
2
4
Zurich, Switzerland
3
3
Basel, Switzerland
4
5
Bern, Switzerland
5
6
Hong Kong
6
9
Seoul, Korea Republic
7
11
Tokyo, Japan
8
8
Oslo, Norway
9
7
Stavanger, Norway
10
10

-ENDS-

Notes to Editors

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 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 2013 and September 2018 surveys. ECA’s Cost of Living Survey rankings began in 2005.

Cost of living indices are used by ECA 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.

For further information, please contact:

Jack Firth 
Tel: +44 0 20 7351 5000
Email: Jack.Firth@eca-international.com 

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