Cost of living rises for expats in Abu Dhabi and Dubai.

Summary: Mercer study sees UAE cities leading the way as expat cost of living rises across GCC 

The new Cost of Living Survey from leading global HR consulting firm Mercer has today revealed Dubai as the most expensive city in the GCC for expats to live in, having risen to 20th place from a ranking of 52nd last year. The UAE capital Abu Dhabi isn't far behind, rising 39 places from 65th to 26th in the ranking.

The cost of living for expats based elsewhere in the GCC has also risen, with Kuwait City, Kuwait moving from 94th to 77th; Manama, Bahrain from 112th to 82nd; Riyadh, Saudi Arabia from 119th to 90th, and Jeddah is the least expensive city in the region ranking 109th from 126th. The remaining cities in the GCC didn't fall in the 143 rankings of the study.

Based on the spending habits of expat communities in 143 cities across six continents, the Mercer Cost of Living Survey measures the comparative cost of over 200 items in each location, including housing, transport, food, clothing, household goods and entertainment; where possible these are international brands.

Commenting on the study, Bassam Gazal, who heads the Mercer Survey practice across the Middle East said: "As a direct impact of the economic downturn over the last year, there have been significant fluctuations in most of the world's currencies. As currency fluctuations play a large role in the cost of living rankings this, has had a profound impact on this year's ranking.

"In the cases of Dubai and Abu Dhabi, a stronger U.S. dollar meant an increase in rankings for these cities. That being said, in this study the currency fluctuations and inflation rates affect only the expatriate programmes for which the Cost of Living survey is dependent on -- accounting for the jump in rankings for the GCC countries included."

Globally, Tokyo knocked Moscow off the top spot to become the world's most expensive city for expatriates. Osaka is in second position, up nine places since last year, with Moscow now in third place. Geneva climbs four places to fourth position and Hong Kong moves up one to reach fifth. Johannesburg has replaced Asuncion in Paraguay as the least expensive city in the ranking.

In Mercer's survey, New York is used as the base city for the index and scores 100 points, all cities are compared against New York and currency movements are measured against the US dollar. It is the world's most comprehensive cost of living survey and is used to help multinational companies and governments determine compensation allowance for their expatriate employees.

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