OVER the past six months, Singapore has become even more expensive for expatriates to live in, climbing from ninth spot in Asia to No. 8, said the latest cost of living survey from ECA International.
Rising prices and the strengthening of the Singapore dollar against major currencies propelled Singapore in the cost of living stakes from 79th position globally to 42nd over the past year.
That means it is more expensive for expatriates to live in Singapore than Central London which is ranked 50th worldwide, but not New York, which came in at No.39, based on ECA's latest twice-yearly survey, released yesterday.
However, it is not all doom and gloom. ECA International regional director for Asia Lee Quane said the rise in Singapore's cost of living is a double-edged sword.
'For companies bringing senior talent into Singapore, the cost of an assignment will increase as higher allowances are required to maintain employees' purchasing power. On the other hand, companies sending employees out of Singapore can apply lower cost of living allowances and still provide sufficient remuneration to maintain a good standard of living.'
The difference between the cost of living in Singapore and that of Hong Kong, the sixth most expensive city in Asia, is also rapidly narrowing, he noted. Two years ago there was a 15 per cent gap in the cost of living between Hong Kong and Singapore. This gap fell to 7 per cent a year ago and now stands at just 2 per cent.
TV producer Sha Liang, 23, who hails from the United States, told The Straits Times that she does feel that certain costs in Singapore are high. Her monthly rent, for example, takes up a third of her salary.
However, an expatriate's cost of living will largely depend on his or her lifestyle, she added. 'If you eat at hawker centres every day, that's affordable. But if you go out with friends a lot and go to nice restaurants, then those bills do add up quickly.'
Overall, Tokyo maintained its position as the most expensive location in Asia and worldwide for expatriates. In fact, ECA International noted that the gap between Tokyo and other locations in the region is widening: a year ago, the difference in cost of living between Tokyo and Hong Kong was 45 per cent. Today, it is 55 per cent.
Stronger currencies have led to HR managers having to increase their cost of living allowances for those in Seoul and Tokyo. Even in typically low-cost locations such as Bangkok and Jakarta, where the relative low cost of living has increased recently, HR managers are having to consider introducing allowances. Equally, the weakening of the euro has seen the cost of living in Dublin plunge.
Worldwide, Luanda in Angola was the second most expensive place after Tokyo. The Japanese city of Nagoya came third.
The survey calculates cost of living allowances for employees assigned around the world. It compiles data on allowances for goods and services consumed by them, such as food, drinks, tobacco and clothing.