Expats feel price hike pinch
Spurred by the rising value of the renminbi and soaring commodity prices, the cost of living for expatriates in Beijing and Shanghai is fast catching up with expensive cities in Asia, a recent survey has found.
Beijing and Shanghai are up 13 and 23 positions to rank 95th and 100th among 300 locations worldwide, according to the latest Cost of Living Survey conducted by ECA International, a leading international human resources organization.
The two cities are catching up with traditionally more expensive locations in the region, such as Hong Kong and Taipei, the survey said.
Many expatriates said it is true that living costs have been going up in recent months but there are big variations as well in terms of currencies they use to pay for their rents or their lifestyles in China.
Executives whose salary packages are denominated in dollars feel the pinch more than those, for example, who are paid in euros. The renminbi has been rising against the greenback while dipping against the euro.
Meanwhile, the survey found that the difference in living costs across China remains considerable, with 95th-placed Beijing ranked 87 places higher than China's least costly city, Xiamen.
But the cost of living in second-tier Chinese cities is catching up quickly.
Living costs for foreigners in Chongqing have increased about 12 percent in the past 12 months - double the rise in living costs experienced by foreigners in Beijing during this period.
A 6 percent rise in the cost of goods and services typically purchased by expatriates has meant that despite the weakening Hong Kong dollar, Hong Kong's position in the ranking has remained steady and is still the fifth most expensive location in the region and 79th worldwide.
The survey is conducted twice a year comparing a basket of 128 consumer goods and services purchased by expatriates in over 300 locations worldwide.