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Beijing costlier than HK, survey finds

By Wang Zhuoqiong (China Daily)
Updated: 2009-06-12 15:54

Beijing, Shanghai and Hong Kong have jumped in a year to be ranked among the world's 30 most expensive cities for tourists and expatriate workers.

The Chinese capital surpassed Hong Kong, a city well known for its lavish lifestyle, as it rocketed from 104th to 26th position in the latest cost of living survey by ECA International, a human resources company.

Shanghai jumped from 111th to 28th position in the March survey and Hong Kong moved 69 places to become the world's 29th most expensive city.

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The survey found that as America and Europe bore the brunt of the recession, strong Asian currencies were pushing up the cost of living for staff assigned to major Asian locations.

The survey, which featured 15 Chinese cities and is conducted twice a year, compares a basket of 125 consumer goods and services commonly purchased by international assignees in over 370 locations worldwide.

Lawrence Ong, a foreigner working for a UN agency based in Beijing, said the capital was more expensive than he had anticipated.

"A cup of coffee costs around 30 yuan ($4), about the same price I pay in countries such as Singapore," he said.

"It is easy to find very expensive restaurants, or very cheap and affordable ones, but it is quite difficult to find mid-range places."

Based on ECA's survey, the China News Agency conducted an online poll about money pressures in Beijing, Shanghai and Hong Kong. More than 80 percent of the 20,000 respondents said their monthly expenditure exceeded their income and that concern about housing costs topped worries about food, clothing and transportation.

The ECA survey found Tokyo remained the most expensive Asian city. This was mainly because of the appreciation of the yen against other major currencies.

"The strengthening of Asian currencies is the dominant factor contributing to the region being more expensive for visitors than it was 12 months ago," explained Lee Quane, regional director of Asia, ECA International.

"In that period, the yuan has continued to strengthen while the yen has appreciated by almost 8 percent against the US dollar.

"As a result, people coming from Western countries into Asia will notice a considerable difference in costs compared with 12 months ago," he said.

In Hong Kong, although the effect of inflation has been more moderate than last year, the cost of goods and services is now higher, it found. The Hong Kong dollar is pegged to the US dollar.

"The main reason is the strengthening of the US dollar over the year," he said.

"Companies sending staff into Hong Kong and paying them in their home currency are likely to have seen the purchasing power of their staff adversely affected."

Currency fluctuations played a major role in survey rankings, but falling inflation and, in particular, the drop in petrol prices from the record highs of last year, also had an impact.

A women walks past a signboard of luxury shop Mont Blanc in Beijing.[File photo]