As Singapore moves up a notch in the rankings to place 13th in Mercer’s World Cost of Living Survey 2008, disgruntled expatriates say they are unhappy with the cost of housing and office leases.

Singapore’s rise in the rankings is partly attributable to the appreciation of the Singapore dollar against the US dollar, the survey found. Managing director for Mercer in ASEAN, Su-Yen Wong says another contributing factor is due to the country’s continued strength as a hub for the region, which, combined with its high quality of living, has resulted in a continued flow of both investment and talent from overseas.  “Consequently, this has increased demand for items such as housing, food and transportation,” she says.  

Even though certain cities such as Jarkarta, Bangkok and Vietnam have experienced a significant drop in the rankings, the survey has indicated a general rise in the cost of living in Asia. 

Tokyo, the costliest Asian city, climbs two places to number two, with Seoul closing the top five and Hong Kong following closely at number six. There have also been significant changes further down the list. In India, Mumbai moves up four places to reach 48, whereas New Delhi climbs 13 places to 55 due to the strengthening of the India rupee against the US dollar. Similarly, Manila rises a total of 27 places to 110, mainly as a result of price increases of international-standard accommodation. 

“Despite Asian cities dominating the top ten most expensive places to live and with many Asian cities climbing the rankings this year, the cost of living in Asia somehow has not deterred many companies and their employees from wanting to come to Asia to set up operations or gain working experience in the region. This could be attributed to Asia (due to its attractive business environment) being the current focus for foreign direct investment from multinational organisations seeking to grow revenue and extract significant profits,” Mercer’s Asia Pacific head of information product solutions Neo Siew Khim says. 

This sentiment, however, threatens to change, as findings from the latest Asean Business Outlook Survey by the American Chamber of Commerce (AmCham) suggest. 

According to the survey, the increase in cost of living has left 74% of American executives in Singapore dissatisfied with cost of housing and office leases. This figure is a significant increase from 2007’s numbers, up from 61% and 45% respectively. 

Maintaining that it is important to remain competitive, Yvonne Traber, a principal and research manager at Mercer says, “Keeping on top of the changes in expatriate cost of living is essential so companies can ensure their employees are compensated fairly and at competitive rates when stationed abroad.”