Lisbon is the 109th most expensive city in the world in terms of cost of living for expats, 26 positions lower than in 2021, in a ranking led by Hong Kong, according to a study published by Mercer at the end of June 2022. We have the details.
Cost of living 2022
"Considering only the European continent, Lisbon is the 36th most expensive city for expats," concludes the study "Cost of Living 2022", launched by the consulting firm Mercer, which includes 227 cities across the world where expat workers live, proving that the standards of international mobility of employees are evolving as a result of the exchange rate and inflation and the increase of remote and flexible work.
The study of the most expensive cities in the world for expats was conducted by analysing the combined comparative cost of more than 200 items in each location, including housing, transport, food, clothing, household goods and entertainment, and using New York (USA) as the base city for all comparisons, including currency movements, measured against the US dollar.
Four Swiss cities in the top 5
In the world ranking, Hong Kong is once again the most expensive city in the world for foreigners, a position it had held for consecutive years, but which in 2021 it lost to Ashgabat, Turkmenistan, taking second place.
According to the "Cost of Living 2022" study, the Swiss cities of Zurich (2nd), Geneva (3rd), Basel (4th) and Bern (5th) complete the top five most expensive locations in the world for expats.
On the European continent, in addition to the four Swiss cities, the ranking is topped by country capitals, namely Copenhagen (Denmark), which is ranked 11th in the world, London (UK, 15th), Vienna (Austria), 21st, Amsterdam (Netherlands, 25th) and Oslo (Norway, 27th).
Lisbon is the only Portuguese city and has dropped 26 places
Lisbon, the only Portuguese city included in the study, dropped 26 places in the world ranking, becoming the 109th most expensive city in the world in terms of cost of living for expats and the 36th at European level, falling below the middle of the table of 57 European cities, behind cities such as Madrid (ranked 90th in the world) or Barcelona (78th).
In Eastern Europe, the most expensive city is Prague (Czech Republic), ranked 60th out of 227 cities, followed by Riga (Latvia, 79th), Bratislava (Slovakia, 105th) and Tallinn (Estonia, 140th), according to the study, which indicates that the cheapest city is Sarajevo, in Bosnia and Herzegovina, ranked 209th in the world and at the bottom of the table of European cities.
Pandemic and war leading to uncertainty
"The rise of remote and flexible working, the war in Ukraine, currency fluctuations and widespread inflation are having a material impact on employee pay, which could have serious consequences for companies in the global battle for talent," the report said.
Tiago Borges, career business leader at Mercer, quoted in a statement on the study, says that "the volatility triggered by COVID-19 and exacerbated by the crisis in Ukraine has fuelled global economic and political uncertainty", a situation reflected "with inflation rising significantly in most countries around the world", which worries foreigners when it comes to their purchasing power and socio-economic stability.
"Both inflation and exchange rate fluctuations directly influence the purchasing power of those working outside their home country," explains Tiago Borges, noting that the rise of remote and flexible working has also led many employees to rethink their priorities, work-life balance and choice of location.
The data presented in the Mercer study, in addition to demonstrating that "labour and economic conditions around the world are evolving faster than ever before", allows companies to assess the costs of international contracts in uncertain times.
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