Mercer study sees UAE cities leading the way as expat cost of living rises across GCC
The new Cost of Living Survey from leading global HR consulting firm Mercer has today revealed Dubai as the most expensive city in the GCC for expats to live in, having risen to 20th place from a ranking of 52nd last year. The UAE capital Abu Dhabi isn't far behind, rising 39 places from 65th to 26th in the ranking.
The cost of living for expats based elsewhere in the GCC has also risen, with Kuwait City, Kuwait moving from 94th to 77th; Manama, Bahrain from 112th to 82nd; Riyadh, Saudi Arabia from 119th to 90th, and Jeddah is the least expensive city in the region ranking 109th from 126th. The remaining cities in the GCC didn't fall in the 143 rankings of the study.
Based on the spending habits of expat communities in 143 cities across six continents, the Mercer Cost of Living Survey measures the comparative cost of over 200 items in each location, including housing, transport, food, clothing, household goods and entertainment; where possible these are international brands.
Commenting on the study, Bassam Gazal, who heads the Mercer Survey practice across the Middle East said: "As a direct impact of the economic downturn over the last year, there have been significant fluctuations in most of the world's currencies. As currency fluctuations play a large role in the cost of living rankings this, has had a profound impact on this year's ranking.
"In the cases of Dubai and Abu Dhabi, a stronger U.S. dollar meant an increase in rankings for these cities. That being said, in this study the currency fluctuations and inflation rates affect only the expatriate programmes for which the Cost of Living survey is dependent on - accounting for the jump in rankings for the GCC countries included."
Globally, Tokyo knocked Moscow off the top spot to become the world's most expensive city for expatriates. Osaka is in second position, up nine places since last year, with Moscow now in third place. Geneva climbs four places to fourth position and Hong Kong moves up one to reach fifth. Johannesburg has replaced Asunción in Paraguay as the least expensive city in the ranking.
In Mercer's survey, New York is used as the base city for the index and scores 100 points, all cities are compared against New York and currency movements are measured against the US dollar. It is the world's most comprehensive cost of living survey and is used to help multinational companies and governments determine compensation allowance for their expatriate employees.
The figures for Mercer's cost of living and rental accommodation costs comparisons are based on a survey conducted in March 2009. The 2009 comparisons are based on a similar survey conducted in March 2008. The information is used by governments and major companies to protect the purchasing power of their employees when transferred abroad; rental accommodation costs data is used to assess local expatriate housing allowances. The choice of cities surveyed is based on the demand for corresponding data from companies and governmental organizations.
Note the cost of living indices in this press release and the accompanying table have been prepared specifically for the purpose of the press release. The indices are based on Mercer's cost of living database and are modified to include housing and to reflect constant weighting and basket items. The results may differ from those calculated for Mercer's clients who use the results solely for the purpose of expatriate compensation. We do not recommend that expatriates use the figures represented here to compare their own compensation packages.
Mercer is a leading global provider of consulting, outsourcing and investment services. Mercer works with clients to solve their most complex benefit and human capital issues, designing and helping manage health, retirement and other benefits. It is a leader in benefit outsourcing. Mercer's investment services include investment consulting and multi-manager investment management. Mercer's 18,000 employees are based in more than 40 countries. The company is a wholly owned subsidiary of Marsh & McLennan Companies, Inc., which lists its stock (ticker symbol: MMC) on the New York, Chicago and London stock exchanges. For more information, visit www.mercer.com
Mercer is also a premier provider of advice and market data on international and expatriate compensation management, and works with multinational companies and governments worldwide. It maintains one of the most comprehensive databases on international assignment policies, compensation practices and data on world-wide cost of living, housing and hardship allowances. Its annual global mobility forums provide companies with the latest trends and research on mobility issues.
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© Press Release 2009
