The Economist Intelligence Unit (EIU) released its annual Cost of Living report for 2013. The study ranked both the most expensive and cheapest cities in the world. Tokyo continues to top the list of priciest places to live in.
Most Expensive Cities
EIU’s survey includes 131 of the largest cities on the globe. It is based on the cost of more than 160 different items and services like utilities, transport, as well as food and drinks.
Again, the title most expensive city in the world belongs to Tokyo. Japan’s capital has climbed to the first spot six times in only two decades.
Another Japanese metropolitan city was ranked high on the list. Osaka managed to reach the second place, even though the cost of living in the area has dropped. That was caused by the weaker yen and the deflation in Japan.
The two Asian-Pacific cities pushed Geneva and Zurich down the chart. Zurich is now occupies the 7th spot, while Geneva barely managed to stay among the top them on the 10th place. The two Swiss cities mark the biggest drop on this year’s Cost of Living survey.
However, Geneva and Zurich are not the only European cities that have become cheaper. Paris has also fallen down the list with two spots and is now 8th. This tendency among European cities is due to the big currency fears and economic austerity on the continent.
In contrast, the most expensive city in the U.S., New York, made a huge leap with 10 spots and its now comfortably sitting on the 27th position on the list. That change is explained with the rising costs of groceries and clothes, as well as with the more stable and stronger U.S. dollar. Interestingly, such a rise was not something common for the cities in the 2013 EIU’s survey. The research found that only 12 of the 131 cities experienced a cost of living rise.
Canadian city Vancouver was found to be a bit pricier than its U.S. neighbor. However, surprisingly the most expensive city in America was not situated in the States or Canada, but in Venezuela. Caracas makes an impressive jump with 25 positions. The reason – fixed exchange rates with the U.S. dollar and different inflation levels. Moreover, some economists predict that the Venezuelan city will soon be among the first ten. It is expected that the price volatility there will continue to stay strong. If that happens, the inflation levels will reach 20%.
Similar to Asian-Pacific cities, Australian ones, like Sydney (3) and Melbourne (4) are also doing well on the chart. That is due to the big economic growth in the country.
The world cost-of-living picture has changed so dramatically that today half of the positions on the list are taken by cities in the Asian Pacific and Australia. In comparison, only two decades ago, the dominance was held by Europe.
Cheapest Cities
You may be surprised to learn that the cheapest cities in the world are mainly large and popular financial centers, highly-urbanized areas or capitals. The city with the lowest cost of living is Karachi, Pakistan. Although, a main seaport and the third biggest city in the country, Karachi holds the first spot on the cheapest cities list.
Karachi is followed by two of the largest cities in India – Mumbai (2) and Delhi (3). The two cities, however, do not take these positions for the first time. Cost of living has gone down in some South Asian and Gulf countries. Kathmandu, Nepal (4) and Colombo, Sri Lanka (7) are making a big jump on the cheaper cities’ list. Gulf cities Jeddah, Saudi Arabia (9) and Tehran, Iran (10), however, are enjoying some progress.
Among the cheapest metropolitan cities in the world are also Algiers, Algeria (5), Bucharest, Romania (6), and Panama City, Panama (8).
Where is Dubai?
The living cost in Dubai is ranked at the 96th spot. That means that the city is still part of the priciest cities. However, compared to 2012, this year the City of Gold drops with two positions. The fall of Dubai started in 2012 when the city was pushed down the chart with 16 positions. The good news is that the decrease cost of living in the city attracts more investors and businesses in the area.
Abu Dhabi is doing better than Dubai. This year it makes a jump with two spots and is now 83rd. The main reason for that are the stable rentals and the petrol’s price. Nevertheless, only a decade ago, Abu Dhabi was sitting at the 63rd spot.
