How is the cost of living in a city determined according to the Mercer ranking?
The human resources consulting firm, Mercer, revealed earlier this month the twenty-fourth edition of the 'Cost of Living Survey' that seeks to identify the cost of living of major cities in the world in order to determine which destinations cost more to the companies with expatriate workers.
Leer en español: Sao Paulo, la ciudad más cara para extranjeros en América Latina
Worldwide, the ranking is led by the city of Hong Kong, where the monthly rent of an apartment in a middle class area can cost $ 2,195, according to expatistan.com, dedicated to collecting data for expatriates.
For Mercer, an expatriate is someone whose company has sent him to develop his work in another country, for a limited period of time, differentiating this condition from that of immigrant. For this reason, the main data taken into account to develop the ranking is the preservation of the purchasing power of people, that is, how much they can buy with the same salary in their local currency.
In Latin America, the largest city in Brazil, Sao Paulo, ranks as the most expensive city for expatriates, ranking 58th in the ranking. Sao Paulo is followed by Santiago (69), Montevideo (75) and Buenos Aires (76).
Leja em português: São Paulo, a cidade mais cara para estrangeiros na América Latina
It's not just about the cost of living
In any case, Latin America continues to be one of the cheapest regions for foreigners, because in addition to having a low cost of living on average, they have developed markets that allow them to use foreign currencies and access goods without having to import them in a particular way.
This differentiates Latin America from regions such as Africa, where although the cost of living is low, the difficulty of the markets to provide goods in an accessible manner means that the foreign currency does not retain its value and usefulness.
For this reason, African cities such as Luanda, in Angola, and Ndjamena in Chad are very high in the ranking, occupying positions 6 and 8 respectively. Meanwhile, Windhoek, capital of Namibia, neighbor of Angola, occupies the position 196 in the ranking, which highlights the importance of local markets over the average cost of living in a region.
Tegucigalpa, the cheapest city in the region
Among the four cheapest cities for foreigners in Latin America are two of the Central American capitals, Tegucigalpa, the cheapest one, ranking 201 out of 209 evaluated cities, and Managua, which is ranked 200.
These two are followed by the city of Monterrey, which occupies the position 193, and is positioned as the most economic destination in Mexico, among the cities evaluated, surpassing Mexico City, which occupies the 157th place.
Other cities in the region included in the ranking are: La Paz (199), Asunción (183), San Salvador (174), Bogotá (168), Quito (156), Lima (132), Guatemala City (130), Panama (114) and Rio de Janeiro (99).
Caracas, the Venezuelan capital, was not included in the study, because its position would vary greatly depending on the exchange rate used and the economic condition at the precise moment in which the data was collected.
Latin American Post | Pedro Bernal
Translated from "Sao Paulo, la ciudad más cara para extranjeros en América Latina"