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Dubai has climbed 13 places in Mercer’s Cost of Living City Ranking for 2023, making it the most expensive city in the Middle East North African (MENA) region apart from Tel Aviv, according to a survey by Mercer.
The city is now the 18th most expensive city for expats, with the top five made up of Hong Kong and Singapore, followed by three Swiss cities - Zurich, Geneva and Basel.
Dubai has seen soaring rents over the past year, by up to 35% in one year in popular villa developments, according to real estate experts.
Tel Aviv, Israel fell two places in its ranking to number 8 but was still the most expensive city in the Middle East and North Africa (MENA) region.
Abu Dhabi is the third most expensive in the region, having risen 18 places to 43rd position, followed by Riyadh, which also rose 18 positions to 85, Manama in Bahrain which rose 19 places to 98 and Jeddah which rose 10 places to 101st.
Muscat and Kuwait City occupied the 130th and 131st position.
Mercer tracked the prices of key items bought by expats such as gasoline, cooking oil and bread.
Istanbul, Turkey, which rose 37 places to 185th position, saw the highest price rise of gasoline, followed by Los Angeles, Barcelona, New York City and Berlin.
None of the 227 cities surveyed saw a decrease in the gasoline price.
Istanbul also saw the highest price increase for bread, while the most significant price decreases occurred in Dubai, New York City, Los Angeles, Dubai, Johannesburg and Mumbai.
The least expensive locations in the ranking include Havana, which dropped 83 spots, due in part to strong currency devaluations in mid-2022, and two cities in Pakistan, Karachi and Islamabad.
Mercer’s report said: “The key factors that have shaped the world’s economy in 2022 will continue to exert an influence into 2023.
“More than a year after the escalation of the Russia-Ukraine crisis and the emergence of more contagious COVID-19 variants, many economies are still absorbing the shocks produced by these events.”
Aggressive national monetary policies and tightening of global financial conditions mean many economies are likely to see slower income growth in 2023. Debt levels in many countries are high and inflation has not yet peaked for some economies.
“Inflation and exchange-rate fluctuations are directly impacting the pay and savings of employees who are internationally mobile,” the report said.
(Writing by Imogen Lillywhite; editing by Daniel Luiz)
