Singapore is now Asia’s eighth most expensive city, up from ninth last year, according to survey results by management and assignment solutions company ECA International.
Meanwhile, it ranked 42nd globally, driven by rising prices and the strengthening of the Singapore dollar.
The country first entered the Asian top 10 in the biannual Cost of Living survey of 400 cities of ECA International in 2009. The poll helps multinational firms calculate assignment salaries.
Lee Quane, regional director for Asia at ECA International, said the rising costliness of Singapore as a city is a “double-edged sword”.
“For companies bringing senior talent into Singapore, the cost of an assignment will increase as higher allowances are required to maintain employees’ purchasing power,” said. Mr Quane.
“On the other hand, companies sending employees out of Singapore can apply lower cost of living allowances and still provide sufficient remuneration to maintain a good standard of living,” he said.
ECA International highlighted that the cost of living in Singapore and in Hong Kong has narrowed over the years.
In 2008, the cost of living in Singapore was 15 percent behind Hong Kong, but the discrepancy dropped to 7 percent and 2 percent in 2009 and 2010, respectively.
Hong Kong is ranked by ECA International as the world’s 32nd most expensive city and sixth in Asia.
Assignee remuneration packages are usually affected by exchange rates, availability of goods and inflation.
Exchange rate fluctuations have been the key influence on cost of living movements over the previous year, said ECA International.
Thus, four Japanese cities made it to the top five most expensive cities in the global ranking of ECA International, driven by the country’s ever-strengthening yen.