Zurich overtakes Tokyo as world’s most expensive city
From Europe Feb 20 2012 BY: Simon Danaher
, Online News Editor
, International Adviser
Zurich has, for the first time in at least 20 years, been ranked as the world’s most expensive city in which to live, according to the Economic Intelligence Unit’s Worldwide Cost of Living Index.
The bi-annual survey compares more than 400 individual prices across 160 products and services, including food, drink, clothing, household supplies and personal care items, home rents, transport, utility bills, private schools, domestic help and recreational costs.
The Swiss city increased 34 percentage points on last time, knocking Tokyo from the top spot and rising four places to take the unenviable title of world’s most expensive city. Another Swiss city, Geneva, also jumped a number of places, rising six places to join Osaka as the third most expensive city in the world.
The EIU pointed out that both Japan and Switzerland have seen strong currency movements over the last few years which have made them relatively more expensive than other countries. The EIU said this has become especially true of Switzerland in the last year, where investors in search of a safe haven currency outside of the eurozone have flocked to the Swiss Franc, prompting the Swiss government to peg its currency to the Euro to keep it competitive.
Furthermore, the report said, while Switzerland has long featured among the world’s most expensive cities, the recent strong currency appreciation is responsible for Zurich’s current elevated position. It added that, in local terms, relatively cheaper imports and a stable economy have kept local price inflation low, therefore, while the relative cost of living has increased, in local terms this has not been felt.
The EIU reports a similar story in Japan which has resulted in Tokyo and Osaka holding the title as the world’s most expensive cities in the past.
Aside from the impact of currency inflation, the report also shows yet another indicator of the West to East shift. Singapore, while falling three places to ninth, remains in the top ten, while 14 of the top 50 most expensive cities are now in Asia. Western Europe however still accounts for nearly half (24) of the top 50.