Dubai, Abu Dhabi among world’s most expensive cities to live, report says – News

Tel Aviv ranks 8th globally and remains the most expensive city for international staff in the Middle East

Dubai and Abu Dhabi are among the most expensive cities in the Middle East. The cost of living has increased not only in the UAE but across the region and globally due to geopolitical tensions and strong regional economic growth in the post-pandemic period.

Dubai and Abu Dhabi ranked 18th and 43rd among the most expensive cities in the world, up 13 and 18 places respectively, according to Mercer’s 2023 cost of living report released on Tuesday.

Tel Aviv, ranked 8th in the global ranking, remains the most expensive city for international staff in the Middle East.

The annual study showed prices in Dubai’s basket of butter, cooking oil, sugar and other essentials rose by 23.5%, 6.9%, 3.8% and 15.4% respectively.

The annual study ranks 227 cities from five continents, measuring the comparative costs of more than 200 items in each location, including housing, transportation, food, clothing, home goods and entertainment.

Not just Dubai and Abu Dhabi, but almost every city in the Gulf region has risen in the ranking due to rising cost of living.

Among other regional cities, Riyadh ranks 85th (up 18), Jeddah 101st (up 10), Doha 126th (up 7) and Muscat 130th (down 10). 11 bits).

“Despite the rise in rankings, the relative cost of living in the UAE remains competitive compared with major global cities. Factors such as inflation, exchange rate fluctuations and housing costs have contributed to these changes. The UAE has been proactive in managing these issues, reflecting because of its strong economic resilience,” Mercer said.

Inflation is expected to fall this year in the UAE and the Gulf region. The UAE Central Bank expects the country’s inflation rate to fall to 3.2% as price increases slow across all categories, especially transport and food and beverages.

“Employers in the UAE are taking note of these changes. Our research shows that organizations are delivering an average annual performance increase of 4.2% through 2023. Many of these organizations are reviewing their compensation packages, with more and more organizations increasing bonuses rather than base salary to increase total compensation without long-term commitment,” said Vladimir Vrzhovski, head of financial services and technology at Mercer Middle East.

“Our research shows that in response, 40% of organizations surveyed have reviewed their 2023 policies to increase housing allowances by an average of 5-10% depending on occupation level,” Vrzhovski added.

Globally, Hong Kong topped the list again, followed by Singapore and Zurich, which jumped six places. Other cities in the top 10 include Geneva, Basel, New York City, Bern, Tel Aviv, Copenhagen and Nassau (Bahamas).

The cheapest cities are Islamabad, Karachi, Havana, Bishkek, Dushanbe, Windhoek (Namibia), Ankara, Durban, Tunisia and Tashkent.