Edition 1492
15 September 2018
Edition: 1492

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Lisbon soars up cost of living rankings

in Regional · 28-06-2018 13:51:00 · 0 Comments

Lisbon has jumped 44 places in the latest Mercer Cost of Living rankings, which evaluates the prices and the expense faced by expatriate workers employed in major urban centres across the globe and enters the top-100 for the first time.

The Portuguese capital has now broken into the top 100 most expensive cities for expats for the first time ever, and is ranked 93rd, researchers found. However, Lisbon is still well behind cities like Rome, which is 46th on the list, or Madrid, which is placed 64th.
In 2017, the Portuguese capital was in 137th place in the same study, and this change is “the biggest increase ever for Lisbon since the beginning of the study,” Mercer said in a statement.
The factors that motivate this rise are mainly due to variations of the euro against the dollar, but also reflect a generalised increase in prices in the city in the areas of housing, catering and petrol, the report noted.
From 2016 to 2017, Lisbon had fallen three places in this world ranking, although in the previous year it had risen.
This year, the study found Hong Kong to be the most expensive city in the world, knocking Luanda, which ranked first in the list in 2017, off the top spot. The Angolan capital is now in 6th place.
The survey compares the rent of a three-bedroom apartment in the affluent areas of Lisbon, which is around €2,650 per month, with Hong Kong, where under the same conditions, the price is €10,800 per month.
The analysis published on Tuesday also points out that the rental of a two-bedroom apartment in Lisbon costs around €2,000, while in Paris the value is over €2,600 per month, and in London it is €3,500 euros, for example.
According to the study, along with Hong Kong, the top five most expensive cities in the world are Tokyo, Zurich, Singapore and Seoul.
In Lisbon, the price of petrol is one of the highest compared with the cities at the top of this ranking, Mercer said.
The analysis said that a litre of 95 octane unleaded petrol costs €1.50 in Lisbon, while in Hong Kong it costs €1.63, in Tokyo €1.01, and Zurich €1.34.
Lisbon is the only Portuguese city covered.
According to Mercer’s 24th annual Cost of Living Survey, factors like instability of housing markets, low inflation, and fluctuating prices for goods and services are impacting the cost of doing business in various cities around the world.
“With technology advances and the importance of a globally connected workforce, deploying talent remains a key component of a multinational’s business strategy,” said Ilya Bonic, President of Mercer’s Career business.
“While a mobile workforce allows organisations to achieve greater efficiency, utilise top talent, and be cost effective with international projects, volatile markets and slowing economic growth in many parts of the world require them to carefully assess expatriate remuneration packages.”
Other cities appearing in the top 10 of Mercer’s costliest cities for expatriates are Seoul (5), Luanda (6), Shanghai (7), N’Djamena (8), Beijing (9), and Bern (10). The world’s least expensive cities for expatriates are Tashkent (209), Tunis (208), and Bishkek (207).
“Aligning workforce and mobility strategies by ensuring the right employees are in the right place is more critical than ever for multinationals as they focus on new global business models,” said Mr. Bonic. “And, properly compensating employees on international assignments is as important as it can be costly.”
Mercer’s widely- recognised survey is one of the world’s most comprehensive, and is designed to help multinational companies and governments determine compensation strategies for their expatriate employees. New York City is used as the benchmark for all comparisons, and currency movements are measured against the US dollar. This year’s ranking includes 209 cities across five continents and measures the comparative cost of more than 200 items in each location, including housing, transportation, food, clothing, household goods, and entertainment.
Two European cities are among the top 10 list of most expensive cities. At number three in the global ranking, Zurich remains the most costly European city, followed by Bern (10). Geneva (11) is down four places from last year mainly due to a downward trend in the city’s housing market.
Overall, Western European cities have all risen in the rankings, a result of strong local currencies against the US dollar and the cost of goods and services.
In particular, cities in Germany experienced some of this year’s biggest surges in the ranking, with Frankfurt (68) and Berlin (71) jumping forty-nine spots while Munich (57) climbed forty-one places. In the United Kingdom, Birmingham (128) went
up nineteen places from last year, Belfast (152) jumped eighteen spots, and Aberdeen (134) climbed twelve places from its previous ranking. London jumped ten spots to rank 19.

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Edition 1492
15 September 2018
Edition: 1492

Read this week's issue online exactly as it appears in print.

Twitter

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