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International Business - Global Cost of Living Trends - March 2008

The US has become less expensive for6. Quito, Ecuador (53.23)
expatriates relative to cities in Asia7. Buenos Aires, Argentina (53.25)
and Africa over the past year, says a8. La Paz, Bolivia (53.54)
cost of living comparison of 228 global9. Asmara, Eritrea (54.49)
cities.10.Tashkent, Uzbekistan (56.06)
The cost of living comparison pricesThis means that overall, goods or
goods and services that expatriatesservices that cost USD$100 in New York,
spend their salaries on, and reportscost the equivalent of just USD$16.44 in
indexes for 13 different basket groupsHarare, and USD$53.54 in La Paz.
using New York (100) as the base.The cost of living varies from one
In terms of overall cost of living, Newlocation to another and by type of
York is now the 28th most expensiveexpense, mainly due to local supply and
global city and the 61st in terms ofdemand variations in each location. In
groceries. New York has droppedsome cities, groceries are more costly
primarily due to the weakness of the USwhile accommodation is relatively less
Dollar as well as the economic slowdowncostly and vice versa.
which appears to have slowed theIn terms of groceries Seoul is the most
increase in prices relative to otherexpensive. Africa however has 6 of the
global cities.10 most expensive cities, Brazzaville,
The global cost of living comparisonAccra, Lagos, Abidjan, Kinshasa, and
conducted by shows London is the mostLuanda.
expensive global location forGrocery Cost of Living Comparison - Top
expatriates, while 3 of the top 5 most10
expensive cities are in Asia, withThe top 10 (most expensive) global
Tokyo, Seoul, and Hong Kong ranked 2nd,cities for expatriates to live using the
3rd, and 5th respectively in terms ofprice of groceries as at March 2008 are
overall cost of living.as follows:
Overall Cost of Living Comparison - Top1. Seoul, Republic of Korea
102. Brazzaville, Congo
The 10 most expensive global cities for3. Ashgabat Turkmenistan
expatriates to live, based on overall4. Accra, Ghana
cost of living (Index is in brackets) as5. Lagos, Nigeria
at March 2008 are:6. Copenhagen, Denmark
1. London, United Kingdom (126.63)7. Abidjan, Cote D'Ivoire
2. Tokyo, Japan (121.88)8. Kinshasa Congo Democratic Rep
3. Seoul, Republic of Korea (119.54)9. Luanda, Angola
4. Oslo, Norway (115.39)10.Oslo, Norway
5. Hong Kong, China (113.00)When establishing a salary for a global
6. Copenhagen, Denmark (112.63)assignment it is essential that the
7. Moscow, Russia (110.35)items the expatriate will actually spend
8. Geneva, Switzerland (110.06)their salary on are included in the cost
9. Hamilton, Bermuda (109.63)of living calculation. Similarly the
10.Luanda, Angola (108.51)items that are provided for the
This means that overall goods orexpatriate should be excluded from the
services that cost USD$100 in New York,cost of living calculation. If the
cost the equivalent of USD$126.63 inincorrect items are included or
London, and USD$108.51 in Luanda.excluded, large variations in the
Overall Cost of Living Comparison -calculation of cost of living are
Bottom 10likely. As an example London is ranked
The bottom 10 (least expensive) citiesas the most expensive global location in
for expatriates to live, based onterms of overall cost of living, but is
overall cost of living (Index is inonly ranked 26th most expensive location
brackets) as at March 2008 are:for groceries.
1. Harare, Zimbabwe (16.44)Africa and Asia are becoming relatively
2. Phnom Penh, Cambodia (44.89)more expensive than other global cities
3. Sanaa, Yemen (44.95)after lagging for decades; organisations
4. Dushanbe, Tajikistan (51.24)need to factor this into expatriate pay
5. Tripoli, Libya (53.22)calculations for global assignments.



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