Singapore—Singapore, which tied with Hong Kong and Paris last year as the city with the highest cost of living in the world, slipped from the pole position, in part due to the fallout from the Covid-19 pandemic.
A new report said, “Asian cities have traditionally dominated the rankings in the past years but the pandemic has reshuffled the rankings of this edition.”
While Hong Kong is still ranked first, it is now joined by Paris (France) and Zurich (Switzerland) at the top of the list. Singapore is now ranked fourth, with Osaka (Japan) and Tel Aviv (Israel) tied at fifth place, wrote the Economist Intelligence Unit (EIU) in its Worldwide Cost of Living 2020 report, released on Tuesday (Nov 17).
According to the report, ”The movement of Paris and Zurich to join Hong Kong at the top spot was spurred on by the rise of the euro and Swiss franc against the US dollar, as well as the comparative decline in the cost of living in the two Asian cities that previously sat at the top of the table.”
The EIU report said that many of the changes to this year’s rankings are due to the current pandemic, which has had a considerable effect on the cost of living.
“The coronavirus pandemic has impacted spending habits all over the world, with the prices of essential goods proving more resilient than those deemed non-essential.
However, this translates to prices for staples, such as coffee, cheese, rice, and orange juice, remaining flat, rather than necessarily increasing.”
In Singapore, prices have decreased in part due to a fall in the country’s population, which includes foreign workers who have left due to job loss.
“With the city state’s overall population contracting for the first time since 2003, demand has declined, and deflation has set in. Osaka has seen similar trends, with consumer prices stagnating and the Japanese government subsidising costs such as public transport,” the report read.
The Business Times noted that Tehran, the capital of Iran, made the biggest jump in the cost of living. It rose 27 places up the list due to sanctions from the US.
But the effect of Covid-19 on the US dollar has been the largest determining factor for this year’s cost of living.
Upasana Dutt, the head of worldwide cost of living at The EIU, said, “The Covid-19 pandemic has caused the US dollar to weaken while western European and north Asian currencies have strengthened against it, which in turn has shifted prices for goods and services.”
On the other end of the spectrum, Syria, Uzbekistan, Zambia, Venezuela, and Kazakhstan, respectively, are the five cities around the globe with the least expensive cost of living. —/TISG
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