Tokyo is the world’s most expensive city for expatriates and Moscow the most expensive in Europe, according to the latest “Cost of Living Survey” by the global human resources advisory Mercer, which ranks Prague in the number 69 spot globally and in the number 15 spot in Europe.
The survey covers 214 cities across five continents and measures the comparative cost of over 200 items in each location, including transport, food, clothing, household goods and entertainment. The cost of housing — often the biggest expense for expatriates — plays an important part in determining where cities are ranked, as do currency movements (measured against the US dollar).
“When compared to New York, our benchmark city, most European cities have witnessed a decline in cost of living. Some exceptions exist where accommodation prices have increased or additional VAT taxes have pushed the cost of living up,” said Nathalie Constantin-Métral, the principal at Mercer responsible for compiling the survey, in a statement.
“Despite some marked price increases across the region in the first half of last year and widespread increases in VAT charges, most European cities dropped in the ranking,” she said. “This is mainly due to the unstable economic situation across Europe, which has led to the depreciation of most local currencies against the US dollar. Countries badly hit by the eurozone crisis, including Greece, Italy and Spain, have also experienced drops in rental accommodation prices.”
The survey, which Mercer says is the world’s most comprehensive, is designed to help multinational companies and governments determine compensation allowances for their expatriate employees. Ranking 207, Skopje, Macedonia, is the least expensive city for expatriates in Europe.
After Moscow, Geneva follows in fifth position and Zurich in sixth (up one place from last year). The next European city in the ranking, Bern (14), is up two places from last year, following the strengthening of the Swiss franc against the US dollar. With a few exceptions, the remaining European cities dropped in the rankings, mainly due to a considerable weakening of local currencies, including the euro.
Oslo (18) is down three places from 2011, whereas the next European city on the list, London (25) is down seven places. In 28th position, St. Petersburg is up one place. Paris (37) is down 10 places, whereas Milan (38), Rome (42), Stockholm (46), Vienna (48) and Amsterdam (57) are all down from seven to 13 places.
Helsinki (65) and Prague (69) have both slid down the list, 23 and 22 places respectively. Brussels (71) dropped a more moderate nine places, followed by Dublin (72) – down 14 places. Ranking 207, Skopje, Macedonia, is the least expensive city for expatriates in Europe.