Singapore turns into the world's most expensive city

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Singapore turns into the world's most expensive city

Luc Citrinot - 06 March 2014, 01:14

Singapore has overtaken Tokyo as the world's most expensive city. A title that will confirm the population's feeling that prices have been out of control over the last five years, a feeling that the government tried -obviously unsuccessfully- to fight.

BERLIN- Singapore loves world titles as it helps strengthening the image of the tiny City-State on a global scale. Except that its latest title is definitely not the most coveted one. The Economic Intelligence Unit is publishing twice yearly its survey on global cost living. And surprise: Singapore is now deemed the most expensive city in the world, overtaking Tokyo in The Economist Intelligence Unit said in its twice yearly global cost of living survey that while Singapore was ranked 18th most expensive city in the world a decade ago, factors such as currency appreciation, car ownership or real estate were all up. Last year, Singapore ranked only 6th in the EIU survey.

But this is not the only item to get up: food prices, public transport -taxis are now among the most expensive in Asia due to additional fees and taxes for example-, leisure activities: all is up in the City State. Singaporeans have been complaining increasingly over the last five years over rising living costs, especially for food, transport and rents. The government took a little bit of distance on those issues. A couple of measures were adopted to cool down prices but generally, officials always reply that prices move according to supply and demand...

The number of rich people in Asia is growing very quick positioning Singapore as the perfect financial heaving to manage their wealth. Singapore has seen many millionaires moving into the city. Although this is a good element for the image of Singapore, as it shows how attractive the City State remains, it carries also a negative side: many services and retail target increasingly only upper classes as proven by the proliferation of luxury shopping malls, bars and restaurants. According to the EIU, the 'proliferation of expensive malls and boutiques?also make Singapore the priciest place in the world in which to buy clothes'. A recent hike on taxes over alcool will not help to diffuse the expensive image of the city as prices for drinks just went up by 10% on average in February. Asked at ITB Berlin if the title would affect arrivals to Singapore, two hotel owners dismissed the case, thinking that Singapore still remains good value for money.

Japanese cities used to be the most expensive in the world. However, deflation over the last ten years and a collapsing yen versus most currencies helped Tokyo and Osaka to become cheaper. Tokyo is now ranked number 6 among the most expensive cities just behind Sydney. In Asia, Mumbai, New Delhi, Karachi and Kathmandu were among the cheapest cities to live in the world. Singapore's annual per capita income of more than $50,000 is one of the highest for any country in Asia, but it increasingly masks great disparity in income.