World’s most expensive expat locations
The city of Ashgabat, Turkmenistan has been named as the most expensive city in the world for expats according to findings from the 2020 Cost of Living survey by ECA International. The city has been named as the most expensive city for expats for another year running, with four cities within Switzerland in the top five.
The Cost of Living survey takes several factors into account when compiling the rankings, including the prices of a number of items and services, to compare how expensive it would be to maintain the same standard of living in the new country. Aspects which are considered include:
- Food: Groceries; dairy produce; meat and fish; fresh fruit and vegetables
- Basic: Household goods; recreational goods; general services; leisure services
- General: Clothing; electrical goods; motoring; meals out; alcohol and tobacco
The survey takes place each year and has been running since 2005, with observations carried out between March and September.
Whilst some cities showed little movement in 2020, a number have seen significant declines as a result of COVID-19.
Most expensive expat cities: 2020 findings
It may seem surprising to many that Ashgabat, Turkmenistan has made its way to number one, surpassing the likes of Tokyo and Hong Kong. Turkmenistan is a sovereign city in Central Asia and has experienced significant economic issues and hyperinflation, which means the cost of goods have become increasingly more expensive. The survey reveals that 2020 saw price increases in the city rise by up to 30%. Ashgabat is often referred to as ‘the city of the dead’ due to its empty streets and dwindling number of residents.
2020 has seen a number of other Asian countries fall down the rankings, particularly Chinese cities. The most recent Cost of Living Survey revealed that Beijing and Shanghai have each dropped nine places, to 24th and 19th respectively.
Lee Quane, Regional Director, Asia at ECA International noted how Chinese cities have significantly fallen in the ranking during the latest survey. “Chinese cities have all fallen across the board in our latest rankings due to signs of a weakening economy and poorly performing currency. One of the key contributing factors was undoubtedly the outbreak of the Covid-19 pandemic. However, it is important to note that the yuan was performing poorly before this period too, with the outbreak of the coronavirus exacerbating the relative weakness of the Chinese currency against other major currencies.”
The euro’s (EUR) significant depreciation over the past 12 months has seen all Eurozone locations drop down the rankings with Spanish and German locations among those falling hardest. Madrid, Berlin and Rome are also amongst the European locations to experience a decline.
Australian locations also continue to fall down the rankings – a reflection of the weakened Australian Dollar (AUD) as national growth slows. Every city in Australia has seen declines by over 20 places. Currently, Sydney is now the only Australian city to remain in the top 100 expensive locations for expats.
The United States has experienced significant rises this year, with New York and Honolulu now in the top 20. Quane commented that “the recent strength of the U.S. dollar has been reflected in nearly all U.S. cities moving up in the rankings. In uncertain times, as we are currently seeing with Covid-19 and an impending global recession, many will put their money into what is seen as ‘safe haven’ economies such as the U.S. As a result, the U.S. dollar has strengthened – making things more expensive for expatriates living in the country than in the past.”
In the 2020 Cost of Living Survey, there are now 29 North American locations within the global top 100 most expensive cities for expats. Steven Kilfedder, Production Manager at ECA International, commented that “as the US and Canadian economies strengthened in the past year, the value of their respective currencies has been pushed up, and so too has the cost of goods and services for visitors and expats.”
Brazilian cities have also witnessed a drop in the rankings over the past year, with all of them now out of the top 200. Over recent years, the biggest drop in a Brazilian city was Sao Paulo, which fell from 85th place down to 199th three years ago. Brazilian cities continue to fall down the ranking as the value of the Brazilian real (BRL) depreciates even faster.
With the British pound (GBP) gaining gradual strength, London has now re-entered the top 20 most expensive cities.
Kilfedder commented that “heading into the survey the UK was more optimistic over the economy than in the recent past, after a budget promising increased spending and clarity over Brexit which boosted the British pound (GBP) from previous lows. At the time the UK seemed well placed to avoid the worst of the pandemic but after 14 weeks of lockdown and facing the biggest recession in modern times and limited progress on Brexit trade negotiations, the British pound (GBP) has returned to previous lows. Although a lot can change, UK cities may well struggle to retain the higher place in the ranking in our next survey.”
Top 10 most expensive cities for expats according to ECA International Cost of Living Survey 2020
- Ashgabat, Turkmenistan
- Zurich, Switzerland
- Geneva, Switzerland
- Basel, Switzerland
- Bern, Switzerland
- Hong Kong, Hong Kong
- Tokyo, Japan
- Tel Aviv, Israel
- Jerusalem, Israel
- Yokohama, Japan