The world’s most expensive city for expats in 2011 is, similarly to 2010, Luanda, the capital of Angola. Second in the ranking is Tokyo (Japan), followed by N’Djamena (Chad), Moscow (Russia) and Geneva (Switzerland).
There are around 20,000 to 30,000 expats working in Romania, according to relocation companies, but only half are registered as foreign employees or diplomats in embassies’ statistics, i.e. around 15,000, because many have their own businesses.
Nikos Kotzias, the Greek general manager of Druckfarben Romania (producer of Kraft Paints, which has a plant in Romania), says Bucharest is not an expensive city when measured against Athens (which ranks 53rd among the world’s most expensive cities).
“However, things are changing fast – in Athens prices are declining significantly because of the economic situation and because of the uncertainty, whereas Bucharest continues its development. Overall the cost of living is lower than in Athens, if we consider rent, the price of gas, food and basic expenditures.”
He says the main problem in Bucharest is the difference between the price charged and the services offered. “I am often faced with situations where services are not up to standards, even in hotels, restaurants and stores that charge high prices,” says Kotzias, who made Romania his home in 2003. He lives in northern Bucharest, in a residential complex in the Lacul Tei area.
Brigitte Schmitt, a Romanian who has lived almost her entire life in Germany and who recently came back to live in Romania (at the end of 2009), says the cost of living in Bucharest does not differ very much from Frankfurt costs.
“Services are usually better and are not as expensive as in Western Europe. For instance, diesel oil and gas prices are 10% to 15% lower in Romania than in Frankfurt. However, the cost of basic foods, such as milk, butter and yogurt are similar to Frankfurt prices, which was a big surprise for me considering that purchasing power in Romania is not as high as in high Western European cities,” she added.
The Mercer survey sampled 214 countries on 5 continents and considered comparative prices paid by expats for accommodation, transport, food, clothing and recreational activities.
An explanation for Angola’s capital ranking first among the world’s most expensive cities is that Luanda has faced a massive inflow of foreign workers and top executives since the country became the second-largest oil producer in sub-Saharan Africa, after Nigeria. In addition, the country’s infrastructure was destroyed following the civil wars that shook Angola, with up to 90% of food currently being imported.