Cape Town - Cape Town is one of the cheapest cities in the world for expatriate employees to live and work, according to a global survey.
The annual Cost of Living report by Mercer compared expenses in 207 cities across five continents, based on a basket of 200 goods and services including housing, entertainment, food, transport and education.
Cape Town was ranked the eighth cheapest city, with Joburg, the only other SA city in the study, placed at number 17.
The report, released earlier this week, is designed to assist multinational companies work out how much to pay employees.
Tim Harris, chief executive of Wesgro, the Western Cape’s investment and trade promotion agency, said the research confirmed that the city was an “appealing destination in which to live, work and play”.
“Moreover, the city is the perfect springboard into the rest of Africa, and this latest ranking will ensure that we remain a desirable international business destination.”
But Harris warned that Cape Town should use this ranking “as a positive to enhance our reputation as the preferred headquarters for existing and prospective business in Africa”.
To arrive at its findings, Mercer calculated how much it would cost expats – in dollar terms – to enjoy the same standard of living in each city.
New York was used as the base city.
Mercer, a US-based consulting and financial services company, said Cape Town and Joburg were cheap largely due to the weak rand against the dollar.
Yesterday, the rand-dollar exchange rate was R12.3, up from R10.7 today last year, and R7.6 on this date five years ago.
For the third consecutive year, the Angolan capital of Luanda was ranked the world’s most expensive city for foreign workers coming to live and take up employment.
Despite that city being relatively inexpensive for locals, Mercer said that for expatriates imported goods and safe living conditions in Luanda came at a steep price.
Luanda was followed by Hong Kong in second place as the most expensive city, with Zurich in third place.
Other cities in the top 10 included Singapore (four), Geneva (five), Shanghai (six), Beijing (seven), Seoul (eight) and Bern (nine).
N’Djamena, the capital of Chad, was the 10th most expensive.
Bishkek, the capital of Kyrgyzstan, was found to be the cheapest, followed by Windhoek, the capital of Namibia.
The study noted that Chinese cities were becoming more expensive for expatriates, because of the strengthening of the yen against the dollar.
In addition to Shanghai and Beijing, the two Chinese cities in the top 10, two more – Shenzhen (14) and Guangzhou (15) - were in the top 20 most expensive.
European cities, meanwhile, were found to have become less expensive for expatriates compared to last year.
“Despite moderate price increases in most of the European cities, European currencies have weakened against the US dollar which pushed most Western European cities down in the ranking,” said Nathalie Constantin-Métral of Mercer, who had responsibility for compiling the survey ranking.
“Additionally, other factors like the eurozone’s economy, falling interest rates and increasing unemployment have impacted these cities.”
The German capital of Berlin, for example, was the 106th most expensive city, and Hamburg 124th.
Weekend Argus