A new report by The Economist’s Intelligence Unit (EIU) reveals Singapore, Paris and Oslo to be the most expensive cities in the world.
The report looks at 131 cities across the world, and weighs up a basket of cost of living items against a standard city, namely New York.
As the base-line, New York was ranked as 26th, overall, with a score of 130, indicating that most cities in the world are in fact cheaper to live in than the city.
In its 2014 listing, Singapore topped the list as the most expensive city in the world with a score of 130 – indicating the same basket of goods is almost three times more costly, accoriding to EIU.
The report compares over 400 individual prices across 160 products and services in 131 cities, with more than 50,000 individual prices collected in each survey, conducted each March and September and published in June and December.
These include food, drink, clothing, household supplies and personal care items, home rents, transport, utility bills, private schools, domestic help and recreational costs.
The report notes that a bottle of table wine in Singapore costs roughly $25, almost twice as much as it would cost in Tokyo (around $12.40).
The cost for a box of 20 cigarettes is at US$9.55 in Singapore, versus US$4.45 in Tokyo.
Tokyo, which was the most expensive city in the world in 2013, slipped to the 6th spot on the list – tied with Melbourne, Geneva and Caracas – mainly due to a weakening of the Yen, EIU said.
Ten most expensive cities
Conversely, the report also highlighted the least most expensive cities in the world – with many South Asian cities taking hta top – or rather, bottom – honours.
Mumbai, India, was listed as the least expensive city in the world, with a score of 39, with the Indian capital, New Delhi, ranked as third least expensive with a score of 43.
“Although India has been tipped for future growth, much of this is driven by its large population and the untapped potential within the economy,” the EIU said in the report.
“Income inequality means that low wages proliferate, driving down household spending and creating many tiers of pricing that keep per capita spending low.
“This, combined with a cheap and plentiful supply of goods into cities, as well as government subsidies on some products, has kept prices down, especially by Western standards.”
Ten least expensive cities
The rankings have drawn some criticism from residents of the cities for not accurately portraying the lifestyles and various tax policies of the cities mentioned.
However, EIU maintains that the purpose of the survey is for companies to apply the index to an executive’s spendable income to reach a fair cost of living allowance.
“The purpose of a cost of living allowance is to reimburse employees for excess living costs resulting from a foreign assignment.”
People who make use of the index (as discerned from sales of the report) include heads of research, accountants and strategy advisors as well as CEOs, CFOs and HR directors.