Shenzhen moved up 12 places from last year to become the world’s 17th most-expensive city for expats, according to Mercer’s 2014 survey on cost of living released earlier this week.
Shanghai soared four places to No. 10 while Beijing closely followed at 11th, also with a 4-place jump from last year. Guangzhou leaped 11 spots to No. 24. Hong Kong was placed at 3rd.
The survey, designed to help multinational companies and governments determine compensation for their expatriate employees, covers 211 cities across five continents and measures the comparative cost of over 200 items in each location, including housing, transportation, food, clothing, household goods, and entertainment.
A pair of African cities — Luanda (Angola) and N’Djamena (Chad) — emerged as the two most-expensive cities in the world for expats. Karachi of Pakistan was ranked as the world’s least-expensive city for expats.
“Chinese cities jumped in the ranking mostly due to the strengthening of the Chinese yuan,” said Nathalie Constantin-Metral, principal at Mercer, who compiled the survey ranking.
“While Luanda and N’Djamena are relatively inexpensive cities, they are quite costly for expatriates since imported goods come at a premium,” said Ed Hannibal, partner and global leader for Mercer’s mobility practice.
“In addition, finding secure living accommodations that meet the standards of expatriates can be challenging and quite costly, as well. This is generally why some African cities rank high in our survey,” he said.
Currency fluctuations and the impact of inflation on goods and services have influenced the cost of expat programs as well as the city rankings.