By LYDIA NATHAN
Kuala Lumpur (KL) has slipped from the top 50 most expensive locations for working expatriates in the region, according to a survey by an international firm.
ECA International’s cost of living survey conducted in March this year showed that the ringgit’s depreciation over the last 12 months saw Malaysia’s capital city dropping 15 places to no 212 globally compared to a year ago.
In comparison to other regional cities, KL dropped from no 49 to 53. Hong Kong, Tokyo, Seoul, Shanghai and Yokohama occupy the top five most expensive cities for working foreigners in the region.
Georgetown and Johor Baru (JB) also fell 10 spots in the rankings to 245 and 250 position respectively. The survey covered 262 locations across the globe. But a drop in the rankings does not necessarily be bad for a city. It means a location is cheaper to live in for a working foreigner.
ECA International regional director Lee Quane said the ringgit’s weakness was the reason behind the rankings drop.
“The continued weakness of the ringgit is responsible for KL’s decline in the rankings, as well as Johor Baru’s status as the location with the second-lowest cost of living in the region,” said Quane in a statement released yesterday.
“Cities in Malaysia continue to rank among those with the lowest cost of living for international assignees in the world, and have even become marginally cheaper over the past five years.”
Malaysia’s neighbour — Singapore — is ranked at 24th and 10th most expensive city globally and regionally.
“Prices have risen in Singapore since our last survey. In local currency terms, expatriates in Singapore will clearly have felt an increase in their cost of living in the past 12 months,” Quane said.
“However, as the Singapore dollar has depreciated against many currencies over the course of last year, this has made the cost of living cheaper relative to several other locations than a year ago.”
The gap between Singapore and Malaysia’s cost of living had widened in the last 12 months.
Sydney took the last spot in the top 50 locations, with Adelaide topping the regional rankings, rising 34 places to the 75th place.
Angola’s Luanda topped the charts as the most costly location followed by Hong Kong and three Swiss cities — Zurich, Geneva and Basel.
Tokyo fell one place to number two with other locations in Japan maintaining their positions regionally.
“Prices in Japan have remained stable over the past year. The yen, on the other hand, has weakened against most major currencies, contributing to the decline of Japanese cities in our rankings,” said Quane.
“This means that for many companies, the cost of maintaining their assignees purchasing power while posted here has fallen and international assignees based in Japan may see their cost of living allowances decrease,” he said.
Subsequently, Taiwanese cities have been the highest climbers in the regional rankings, with Kaohsiung rising from 31st to 18th this year.
Ulaanbaatar, Mongolia, remains the cheapest location in the region followed by cities in Malaysia and Myanmar.
“Much of the movement in the rankings among Asian locations in the past 12 months has been strongly influenced by currency movements, with Yangon falling in the regional rankings on account of depreciation of its currency in the past year,” added Quane.
The company also cited that central London tumbled 67 spots out of the global top 100 due to the weak pound.
It is currently the 132nd most expensive location in the world for expatriates but cheaper than Bangkok, Rio de Janeiro and Buenos Aires, as well as its European rivals Paris, Berlin and Brussels.