Dubai is 20th costliest city globally for expats

Dubai is the 20th most expensive city in the world and the costliest in the GCC for expatriates to live in, showed to a survey.

A stronger dollar has pushed Dubai and Abu Dhabi up the list. Dubai leaped 32 places from last year's 52nd ranking, while the capital moved from 65th in 2008 to 26th this year – making it the GCC's second most expensive city, according to the new Cost of Living Survey from HR consulting firm Mercer.

Globally Tokyo is the most expensive city, followed by Osaka in Japan – which was 11th last year – and Moscow, which was rated the most expensive city in 2008.

The cost of living for expats based elsewhere in the GCC has also risen. Kuwait City moved from 94th in 2008 to 77th this year, making it the region's third most expensive city, while Manama, Bahrain, jumped from 112th to 82nd place, making it the fourth costliest, followed by Riyadh, Saudi Arabia, which moved from 119th to 90th.

"US dollar valuation shifts are the prime reason for most moves across the world, including Dubai and Abu Dhabi," Bassam Gazal, who heads the Mercer Survey practice across the Middle East, told Emirates Business.

"A large number of cities worldwide jumped as well, again because of the changes in the dollar valuation," he added.

Gazal said there had been significant fluctuations in most of the world's currencies as a direct impact of the economic downturn.

"This year the moves are all about the relative weight and strength of the dollar against other currencies. Those cities whose currencies are aligned with the dollar have seen greater moves than those where the alignment or relationship is not as obvious," he said. "For instance many countries in the Middle East – the UAE, Lebanon, Jordan, Bahrain, Saudi Arabia – have currencies fixed to the dollar, therefore their cities have moved up in the rankings."

Gazal said the ranking is set in US dollars and the benchmark city is New York City.

"The fact that the dollar appreciated significantly from March 2008 to March 2009 has, therefore, affected the cost of living for expatriates in a whole range of cities, including Dubai and Abu Dhabi," he said.

"One of the highest costs taken into account by Mercer is quality rented accommodation which is often in short supply, and this helps to push up costs."

Jeddah, at 109 this year compared with 126 in 2008, is the least expensive city in the region.

The GCC's remaining cities did not fall within the 143 rankings in the study.

The survey measured the comparative cost of over 200 items in each location, including housing, transport, food, clothing, household goods and entertainment, where possible international brands were used.

Globally, Tokyo knocked Moscow off the top spot to become the world's most expensive city for expatriates. Osaka is in second position, up nine places from last year. Geneva climbed four places to fourth position and Hong Kong moved up one to reach fifth. Johannesburg replaced Asunción in Paraguay as the least expensive city.

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