Manila one of 5 least costly cities

SINGAPORE—Five of the world’s least expensive cities are in Asia, and these are Manila, Kathmandu, New Delhi, Mumbai and Karachi, a survey shows.

The cost of living in Manila is half that of New York, while that of Karachi, the cheapest city in the survey, is just over one-third, the Economist Intelligence Unit says.

But the strong yen has made Tokyo and Osaka the world’s most expensive cities for expatriates, while sharp currency declines lowered living costs in Australia and New Zealand, said the survey received here late Monday.

Because the yuan is tightly linked to the US dollar, costs in Chinese cities increased as other currencies tumbled against the greenback.

Oslo and Paris were the world’s costliest cities in the previous EIU survey.

Shanghai, with a cost of living only 2 percent cheaper than New York’s, is now more expensive than Sydney, says the survey carried out last month.

The previous survey was carried out in September last year, just as a housing mortgage mess in the United States was unraveling into a full-blown global financial and economic crisis.

Seven of the world’s 10 most expensive cities in the latest survey are in Europe, with Singapore joining Tokyo and Osaka as the only Asian cities on the list.

“Two factors drive the relative cost of living: local prices and exchange rates,” said Jon Copestake, the editor of the report.

“Normally, our ranking of cities by cost of living is relatively stable, but… the current global climate changes in exchange rates have significantly altered our assessment of the most and least expensive cities.”

In the survey, EIU compared the cost of products and services in 140 cities. It is aimed at helping companies calculate allowances for executives and their families being sent overseas.

France’s capital Paris is now the world’s third-most expensive city, down from number two in the EIU’s previous survey, followed by Copenhagen and former number one Oslo.

Zurich was in sixth place, while Frankfurt and Helsinki tied in seventh place, followed by Geneva.

“The decline in European currencies, most notably the euro, sterling and Norwegian krone, has driven a significant weakening in the relative cost of living for many European cities,” the survey says.

Singapore, Southeast Asia’s most advanced economy, was ranked as the 10th most expensive city worldwide, followed by Hong Kong, which rose to 11th place from 28th.

Shanghai rose to 29th place from 45th, while Beijing rose to 36th place from 58th. Sydney fell to 35th, down from 17th.

Thailand’s capital, Bangkok, is number 72 in the worldwide rankings, but is the second-most expensive city in Southeast Asia after Singapore.

Kuala Lumpur in Malaysia is number 90 worldwide and number three in Southeast Asia. AFP