Revealed: The world's cheapest (and most expensive) cities
City living has long been an aspiration for many, though this frequently means higher rents and learning to put up with far more people. The former is especially true in Hong Kong, Paris and Zurich, which have just been named the world's most expensive cities.
The Economist Intelligence Unit (EIU), which rates 133 global cities, and compares the price of a basket of 138 everyday items in each, drew up a ranking of 2020’s most and least expensive metropolises to live in – the above two European cities overtook last March’s tied top spot winners, Singapore and Osaka, to become the joint costliest cities in the world alongside Hong Kong.
While interest in the priciest, and cheapest cities, has always been high, this report is especially pertinent, highlighting the impact of Covid-19 on global economies. The survey was conducted for an unprecedented second time this year, to take into account Covid-19's impact on prices around the world.
“The Covid-19 pandemic has caused the US dollar to weaken while western European and north Asian currencies have strengthened against it,” said Upasana Dutt, head of Worldwide Cost of Living at The Economist Intelligence Unit, “which in turn has shifted prices for goods and services.” A rise in the Swiss Franc was also behind Zurich’s ascent to the top spot.
Though currencies in Asia have strengthened, this isn’t the only factor in these price shifts. According to the EIU, prices in Singapore fell as the pandemic led to an exodus of foreign workers. The EIU commented that, “the city state's overall population [was] contracting for the first time since 2003, demand had declined, and deflation had set in.”
Osaka has also seen similar trends, “with consumer prices stagnating and the Japanese government subsidising costs such as public transport.”
'The pandemic has transformed consumer behaviour, as lockdowns and trends such as working from home have increased the prices of consumer electronics and meal-at-home kits have taken the place of restaurant dining for middle-class families,” continued Dutt.
These price trends may also be set to stick around: “although much will depend on the course of the pandemic, we expect many of the above price trends to continue into 2021.”
Los Angeles and Geneva also saw a slight drop in the ranking, each dropping one place to become slightly more affordable. New York - the city the index is benchmarked against - remained in seventh place.
Outside the top ten, two UK cities saw increases in price. London moved up three places to 20th position, while Manchester has taken 46th place, compared to 51st earlier in the year. The biggest rise, however, is Tehran, which has climbed up the ladder from 106th to 79th place, due to US sanctions impacting supplies.
As for the most affordable cities, Damascus, the capital of war-torn Syria, was rated as the cheapest city in the world. Prices were only slightly higher in Tashkent, the capital of Uzbekistan, which came in second place.
Lusaka in Zambia and the Venezuelan capital, Caracas, joined the two among the cheapest cities in the world.
Outside the top ten, Reykjavik, Rio de Janeiro and Sao Paulo showed the biggest price drops. "Weak currency and rising poverty levels," were behind the Brazilian cities price drops, said EIU. Covid has sadly devastated the South American country.
As for Buenos Aires, the other South American city in the top ten cheapest cities, it is likely in the top ten cheapest cities due to price controls introduced by the Argentinian during the pandemic.
Have you visited any of the cities on the list? Any tips on how to keep costs down when you visit them? Tell us what you think in the comments section below.
