The Most Expensive Cities In The World (2022)

Most Expensive Cities In The World - Most Expensive City - 2022 - Hong Kong

Global mobility company and cost of living experts – ECA International – has published its annual list of the most expensive cities in the world for 2022.

For the third consecutive year, Hong Kong has claimed the honour/dishonour of being the priciest location for expatriates and foreign workers. But as just one of four cities from Asia to make the Top 10 – and just one of ten cities from Asia to make the Top 20 – there’s clearly a larger trend at hand.

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“The majority of the mainland Chinese cities in our rankings have higher rates of inflation than we are used to seeing, but they are still typically lower than elsewhere in Asia,” explains Lee Quane, ECA Regional Director for Asia.

“Therefore, the main reason for their rise in the rankings has been the continued strength of the Chinese yuan against other major currencies.”

“After an extended period of low inflation, Tokyo hit its highest inflation rate in three decades, but the Japanese capital has dropped below London in the ranking due to the yen remaining weaker than other major currencies combined with relatively flat rental costs.”  

Asia is also where you’ll find the fastest-rising city on the ECA International’s list of most expensive cities. Colombo – Sri Lanka’s main metropolis – progressed 23 places upwards from 162nd to 149th.

Most Expensive Cities In The World - Most Expensive City - 2022 - Colombo Sri Lanka

Anyone looking for a change of scenery might do well to consider certain pockets of Europe’s united nations.

According to ECA International, Paris – which topped the list in past years – has soundly fallen outside of the Top 30, while the likes of Rome, Madrid, and Brussels are also easing off the money pedal.

“Nearly every major Eurozone city saw a drop in the rankings this year as the euro performed worse in the last 12 months than the US dollar and British pound,” adds Lee Quane.

Where do the most expensive Australian cities rank globally?

“Inflation has risen significantly in Australia, as it has in many countries,” notes ECA International Production Manager Steven Kilfedder.

“But the weak Aussie dollar has made the country a little cheaper for visitors than before, which explains the small fall in ranking for most cities.”

“Sydney has bucked the trend but only because other cities around it have fallen.”

Here are the most expensive cities in Australia for expatriates and foreign workers…

  1. Sydney (39th)
    2021 Ranking:
  2. Canberra (55th)
    2021 Ranking: 52nd
  3. Melbourne (56th)
    2021 Ranking: 51st
  4. Perth (76th)
    2021 Ranking: 74th
Most Expensive Cities In The World - Most Expensive City - 2022 - Sydney Australia

How have the world’s most expensive cities been determined?

ECA International determines its living report and overall rankings using a basket of day-to-day goods + services commonly purchased by assignees. This time around, the company’s primary research was conducted between a survey period of September 2021 and March of 2022.

Cost of living indices are used by ECA clients to calculate cost of living allowances for assignees. Factors considered include:

  • Food Prices
    Groceries, dairy produce, meat & fish, fresh fruit & vegetables 
  • Basic Costs
    Household goods, recreational goods, general services, leisure services
  • General Costs
    Clothing, electrical goods, motoring, meals out, alcohol & tobacco
  • Utilities Costs
    Water, electric, gas, internet
  • Public Transport Prices
    Bus, train, taxi

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How has record-high petrol prices impacted the rankings?

Fuel, of course, is one of the major contributing factors to an increased cost of living across the world these days as demand “surged ahead of supply” throughout 2022 — escalated by Russia’s invasion of Ukraine. On average, petrol prices have faced a 37% increase, with the only place unaffected being Bamako in Mali.

“Most dramatically, Beirut (Lebanon) saw a 1,128% increase since last year, while Istanbul (Turkey) experienced a 156% increase,” reveals ECA International.

“Elsewhere in Europe, petrol prices have increased across the continent, with Tirana (Albania) seeing the next largest increase at 46%.”

“St Petersburg in Russia saw the smallest price increase in Europe, rising only 10% despite the sweeping sanctions in place, thanks to their domestic oil supply and refining capacity.”

“Meanwhile, in London, motorists are paying 23% more for their petrol than last year – or £18.72 more for a 60 litre tank.”

The Most Expensive Cities In The World (2022)

The other oil problem

Yet another unintended consequence surrounding the war in Ukraine vis-a-vis cost of living? The widespread shortage of crops like sunflowers, which is used for cooking oil.

This, along with a palm oil shortage, has caused cooking oil prices to climb by an average of 25% in the last year across the ranked cities — although it’s much higher in select cities.

Sarajevo in Bosnia saw prices more than double (113%) while prices rose by more than 50% in Mexico City (87%), Istanbul (66%), and Casablanca (55%) among others.

Check out the world’s most expensive cities for expatriates and foreign workers according to ECA International.

The Most Expensive Cities In The World (ECA International)

  1. Hong Kong
    2021 Ranking:
  2. New York (United States of America)
    2021 Ranking:
  3. Geneva (Switzerland)
    2021 Ranking:
  4. London (United Kingdom)
    2021 Ranking:
  5. Tokyo (Japan)
    2021 Ranking:
  6. Tel Aviv (Israel)
    2021 Ranking:
  7. Zurich (Switzerland)
    2021 Ranking:
  8. Shanghai (China)
    2021 Ranking:
  9. Guangzhou (China)
    2021 Ranking:
  10. Seoul (South Korea)
    2021 Ranking:
  11. San Francisco (United States of America)
    2021 Ranking:
  12. Shenzhen (China)
    2021 Ranking:
  13. Singapore
    2021 Ranking:
  14. Beijing (China)
    2021 Ranking:
  15. Jerusalem (Israel)
    2021 Ranking:
  16. Bern (Switzerland)
    2021 Ranking:
  17. Yokohama (Japan)
    2021 Ranking:
  18. Copenhagen (Denmark)
    2021 Ranking:
  19. Oslo (Norway)
    2021 Ranking:
  20. Taipei (Taiwan)
    2021 Ranking:
Most Expensive Cities In The World - Most Expensive City - 2022 - Hong Kong

The Most Expensive Cities In The World (Other Rankings)

Last December, the Economist Intelligence Unit (EIU) released its own annual Worldwide Cost of Living Index to reveal the most expensive and cheapest cities of 2021.

Similar to ECA International, it calculated aggregate scores based on factors such as the average price of fuel, the cost of public transport, groceries, and just about every other living expense.

Paris was dethroned by none other than Tel Aviv. Which is quite impressive/concerning when you consider the coastal Mediterranean city had effectively leapfrogged from 5th place in 2020 all the way to first in 2021. The key reason? A hike in both grocery and transport prices on top of the Israeli shekel’s strength over the US dollar.

“The inflation rate of the prices that we track in EIU’s Worldwide Cost of Living (WCOL) across cities is the fastest recorded over the past five years,” explains the EIU.

“It has accelerated beyond the pre-pandemic rate, rising by 3.5% year on year in local-currency terms in 2021, compared with an increase of just 1.9% in 2020 and 2.8% in 2019.”

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“Supply-chain problems, as well as exchange-rate shifts and changing consumer demand, have led to rising prices for commodities and other goods. The most rapid increases in the WCOL index were for transport, with the price of a litre of petrol up by 21% on average.”

On the opposite end of the spectrum, Rome experienced the biggest drop in EIU’s rankings, falling from 32nd to 48th place. What made this slice of Italy so much more affordable? “Particularly sharp” declines in the shopping basket and clothing categories, apparently.

And in terms of domestic representation, as much as we like to groan about Melbourne and Sydney being proper rorts on the best of occasions, the lack of buying power, the lack of wages increase, interest rates, etc. our beloved cities only ranked 16th and equal 15th respectively – sandwiched right between Tokyo and Vienna above, with Helsinki and London below. So look on the bright side. The cost of living situation could always be worse.

Check out the most expensive cities in the world according to EIU.

Most Expensive Cities In The World - Most Expensive City - 2022 - Tel Aviv Tel Aviv Tel Aviv

Economist Intelligence Unit’s Most Expensive Cities (2022)

  1. Tel Aviv, Israel
  2. Paris, France = Singapore
  3. Zurich, Switzerland
  4. Hong Kong
  5. New York, US
  6. Geneva, Switzerland
  7. Copenhagen, Denmark
  8. Los Angeles, US
  9. Osaka, Japan

Economist Intelligence Unit’s Cheapest Cities (2022)

  1. Damascus, Syria
  2. Tripoli, Libya
  3. Tashkent, Uzbekistan
  4. Tunis, Tunisia
  5. Almaty, Kazakhstan
  6. Karachi, Pakistan
  7. Ahmedabad, India
  8. Algiers, Algeria
  9. Bueos Aires, Argentina
  10. Lusaka, Zambia

Check out the original study published by ECA International below.