The two main Pacific Rim cities of Asia - Hong Kong and Singapore - are among the top five most expensive locations for expat employees.

Hong Kong is the most costly city for expatriates, with Luanda, Angola, in second place and Zurich and Singapore in third and fourth positions respectively, according to data from Mercer, the consultancy.

Tokyo, meanwhile, is in fifth place in Mercer’s 2016 Cost of Living Survey, rising six places from last year. Kinshasa, ranked sixth, appears for the first time in the top 10, moving up from 13th place. Other cities appearing in the top 10 costliest cities for expatriates are Shanghai (seven), Geneva (eight), N’Djamena (nine), and Beijing (10).

The world’s least expensive cities for expatriates, according to Mercer’s survey, are Windhoek (209), Cape Town (208), and Bishkek (207).

The survey is designed to help multinational companies and governments set compensation strategies for their expat employees. New York City is used as the base city for all comparisons and currency movements are measured against the dollar. The survey includes more than 375 cities worldwide. The survey examines the cost of more than 200 items in each location, including housing, transportation, food, clothing, household goods, and entertainment. 

With expats in cities such as Hong Kong and Singapore an important client segment for certain wealth management firms, the data will help frame some of the investment objectives and wealth planning goals such a group of clients may have.

Several cities across Europe remained relatively steady due to the stability of the euro against the dollar. Paris (44), Milan (50), Vienna (54), and Rome (58) are relatively unchanged compared to last year, while Copenhagen (24) and St Petersburg (152) stayed in the same place. 

Other cities saw much greater movements. Oslo (59) and Moscow (67) plummeted 21 and 17 places respectively as a result of local currencies losing significant value against the dollar. London (17) and Birmingham, UK (96) dropped five and 16 places respectively, while the German cities of Munich (77), Frankfurt (88), and Dusseldorf (107) climbed in the ranking. 

“Although the value of the euro has remained steady against the US dollar, the pound has fallen, largely due to Brexit fears,” said Ellyn Karetnick, head of international mobility at Mercer. “But whilst currency fluctuations will always cause a major impact on costs, local conditions like high property prices can counter balance the impact of currency movements, as demonstrated with UK and Western European cities. It is important to understand local costs when deploying employees in countries across the world and we use the Mercer International basket of goods, based on typical spending patterns representative of expatriates, to help calculate rankings and packages.”