Cost of living up for expats in S'pore
Grace Ng
Thu, Jun 12, 2008
The Straits Times
SINGAPORE has become a more expensive place for expatriates to
live, but it is still cheaper than Hong Kong, even though the gap
is closing with its long-time rival.
The Republic jumped 17 places to land at the 114th spot in a
global survey of the costliest cities for expatriates, because of
higher inflation and a stronger Singdollar in the past year.
Singapore closed the gap with pricier cities such as Hong Kong,
which fell in the rankings to the 97th spot, in the survey
conducted by human resources firm ECA International.
Within Asia, Singapore actually fell from the ninth spot six
months ago to the 13th spot, partly because the cost of living in
some Japanese cities had risen rapidly due to the stronger yen.
The purchasing power of expats living in Singapore has been
dented by higher costs such as rents, fuel and food, as well as a
stronger Singdollar.
According to ECA's data, the cost of fuel rose by more than 13
per cent in the last six months, while the price of foodstuffs such
as egg noodles soared by almost 15 per cent.
Inflation in Singapore is now at a 26-year high, after
accelerating at a faster-than-expected rate of 7.5 per cent in
April.
This prompted the Government to raise its inflation forecast to
between 5 per cent and 6 per cent, up from the 4.5 per cent to 5.5
per cent range.
Yesterday, the Singdollar fell to about 1.374 against the
greenback, but analysts expect it to gain further this year as the
Government seeks to rein in inflation.
Mr Scott Colman, 38, an executive in an American technology
company, said he felt the greatest pinch from rising rents and
petrol prices, as well as the strengthening Singdollar because his
compensation package is partly paid in US dollars.
Mr Lee Quane, the general manager of ECA International Hong
Kong, said Singapore's rising cost of living has prompted global
companies to adjust their expat employees' pay and allowances.
He added that the gap between Singapore's cost of living
allowance for expats and that of Hong Kong has shrunk dramatically
from about 20 per cent five years ago to less than 5 per cent
today.
Still, he said Singapore remained a cheaper place for expats
than Hong Kong or Shanghai, and global companies were not
considering relocating their staff from the Republic to the Chinese
cities.
Top spot in the global ranking went to the African city of
Luanda in Angola, where some expat consumer items are hard to get
and command top dollar.
The survey compares a basket of 128 consumer goods and services
such as groceries, clothing and electrical goods that are commonly
purchased by expats in more than 300 locations worldwide.
Multinational firms use the results to help determine how much
to pay their staff who work overseas.
Ms Kate Bryce, a finance professional in her 40s, said her
company recently reviewed her allowance and raised it by about 10
per cent.
'I'm hoping that the Singapore dollar doesn't strengthen further
because I doubt I would get another revision in the next year. Most
companies are tightening their belts as the global economy slows
down.'