European cities power up cost-of-living league

10 August 2004

AMSTERDAM — Amsterdam was one of several European cities that climbed higher on a worldwide cost-of-living table on Tuesday as the weak dollar gave the continent 20 out of the top 25 slots.

Ranked in the spring of 2003 at 14th, the Dutch capital Amsterdam rose to 13th overall in the Economist Intelligence Unit’s bi-annual Worldwide Cost of Living Survey. It is currently the 10th most expensive European city.

But Paris was the big mover as it climbed from seventh to third place in the survey, making it the most expensive city in Europe and putting it within 10 percent of Tokyo, which remains the world’s costliest destination.

Although actual prices have not changed, the weak US dollar and strong European currencies, including the euro, pushed up relative prices in the continent.

Sharing joint third position with Paris is Oslo, which is outside the euro-zone, as are Copenhagen, Zurich and London, which take up fifth and joint-sixth positions respectively.

London rose from tenth position due to the strong performance of the pound against the dollar.

Vienna, at tenth in the latest figures, is the only euro-zone city apart from Paris in the top ten.

Portugal remains the cheapest euro-zone country, with Lisbon (54th) being the only “old EU” city (i.e. excluding those in the 10 new member-states) outside the top 50.

Athens — home to the upcoming Olympic Games — also offers good value as the second-cheapest euro-zone destination.

Worldwide, Osaka Kobe stayed in second position. The world’s cheapest city was the Iranian capital, Tehran.

US cities have seen relative costs fall dramatically in line with the weakening dollar, with New York dropping 14 places to 27th over the past 12 months, making it relatively cheaper than Australian cities such as Sydney (14th) and Melbourne (18th).

The survey compares prices and products in over 130 cities around the world with the aim of providing companies with a guide from which allowances can be calculated for expat compensation packages.

The data used New York as a base index of 100 for comparisons. This gave Tokyo an index of 143, Paris 130, London 125, Amsterdam 111, Munich 110, Frankfurt 107, Berlin 106, Lyon 105 and Brussels 104, Hamburg 100, and Madrid and Barcelona an index of 96.

Subject: Dutch news + cost of living + expat compensation packages