Venezuelan Capital Tops List of Most Expensive Cities in the Americas

Caracas, Venezuela is the most expensive city to live in as an expat in the Americas.

According to Xpatulator.com's cost of living data collected for the April 2014 quarter, Caracas has dropped from being the most expensive expat city in the world to the second most expensive but it still tops the Americas list for foreign workers.

The ongoing rampant inflation, shortages and tight government controls on foreign exchange have continued to ensure that this South American city remains at the top of the rankings, keeping it ahead of Manhattan.  Manhattan which is the second most expensive city in this region, in contrast has well stocked boutiques, while shops in Caracas are suffering from shortages with long lines and bare shelves.  As the world's fifth largest exporter of oil, Venezuela was once a top destination for skilled foreign oil and gas works, this is being eroded by the strict government regulations that limit hiring and compensation for foreign workers and by the high cost of living.

The government price controls and official exchange rate of 6.3 Bolivers to the US Dollar have created a black market where products from cooking oil to rice is diverted to the Colombian border, creating prices that are 10 - 12 times higher. 

Canada is seeing an influx of skilled expat workers coming from this area, with a booming oil and gas industry growing in Calgary, which moved up the list from 101st to 87th most expensive city to live in the region as an expat.

Xpatulator.com provides up-to-date cost of living data for over 700 locations worldwide.

Top Ten City Rankings for The Americas

1. Caracas
2. Manhattan
3. Hamilton
4. George Town
5. Nassau
6. Sao Paulo
7. Brooklyn
8. Rio de Janeiro
9. New York
10. Toronto

For the full ranking list for The Americas go here.

Moving to Caracas

Today we look at moving to Caracas in Venezuela from San Antonio in USA. We highlight cost of living and other major differences likely to be experienced in our series of short blogs on moving between different international locations.

In Caracas people speak Spanish and indigenous languages. In San Antonio people speak English.
Caracas is the capital and largest city of Venezuela. San Antonio is the second-largest city in the state of Texas and the seventh-largest city in the United States. Important industries in Caracas include chemicals, textiles, leather, food, iron and wood products. Caracas is a regional center for the distribution of products. San Antonio has a diversified economy with four primary focuses: financial services, government, health care, and tourism. San Antonio also has a strong military presence.

The overall cost of living rank in Caracas is 80 out of 300 global locations, which equates it with high cost of living locations.  An expatriate moving from San Antonio to Caracas will experience a change in cost of living of 40.2%.
In terms of the hardship people are likely to experience, assessed in global terms, Caracas is ranked as an extreme hardship location with a hardship index of 40% compared to San Antonio with a hardship index of 10% which is a minimal hardship location.

Source: Cost of Living Caracas Venezuela as at July 2011.

Expatriate Spotlight on Venezuela

The petroleum sector dominates Venezuela’s mixed economy, accounting for approximately 80% of exports. Venezuela is one of the five founding members of the OPEC, which was initiated by Venezuelan politician Juan Pablo Perez Alfonzo. Most expatriates in Venezuela are employed in petroleum related sectors.

Expatriates in Venezuela must take appropriate security precautions. Drug traffickers and illegal armed groups are active and there is a risk of kidnapping. The incidence of street crime in Venezuela is high. Armed muggings and ‘express kidnappings’ are a regular occurrence. Where possible you should avoid traveling on the road to and from Caracas International Airport (Maiquetia) during hours of darkness when there are few vehicles on the road. You should take out comprehensive travel and medical insurance before traveling. The most important thing to remember is to use common sense! Suggested precautions:

• Keep money hidden. A money belt under clothes is a probably best.
• Don’t carry large amounts of money. Deposit valuables in a hotel safe.
• Expensive items such as cameras should be carried and used inconspicuously
• Don't leave luggage unattended.
• Don't leave possessions visible in a car, particularly a hire car.
• Avoid walking alone late at night.

Venezuela has public and private healthcare. Public healthcare offers free treatment but charges for prescriptions. Conditions, however, are often different to what expatriates may be used to. Private hospitals offer a higher standard of treatment but require prepayment or a credit card, even for emergencies, and can be very expensive.

Living in Venezuela can be challenging. You are likely to encounter challenges such as:

• stock at the local grocery may sometimes be little to none. You could go on any day and there will be no milk, no butter, certain types of meat, as well as household/kitchen items.
• 'armed' guards at certain locations like malls.
• blackouts occur regularly - about one every 2 days and there is quite strict rationing of electricity in shopping centers, cinemas, casinos, etc as well as on advertising.
• water shortages supplied to your home and having to run water through a tank/pump system can be frustrating.
• large amounts of garbage dumped anywhere.
• little compassion for animals, particularly dogs and cats. You are likely to see many hungry dogs.

Most expats live in apartments because of security. Some prefer furnished homes. If looking for something furnished, it is much easier to find a one or two bed-roomed apartment. Anything bigger is more likely to be unfurnished. Be prepared that it might take 3 months to find a permanent apartment.

Caracas is ranked as an extreme hardship location with a hardship premium of 40%

The overall weighted cost of living difference between New York and Caracas is 42%. The unweighted cost of living difference per basket group is as follows:

Basket Group	Cost of Living in Venezuela, Caracas
Alcohol & Tobacco	75.83%	more expensive
Clothing	22.93%	more expensive
Communication	-1.08%	cheaper
Education	-67.59%	cheaper
Furniture & Appliances	107.59%	more expensive
Groceries	57.50%	more expensive
Healthcare	64.37%	more expensive
Household	45.20%	more expensive
Miscellaneous	10.72%	more expensive
Personal Care	8.23%	more expensive
Recreation & Culture	156.69%	more expensive
Restaurants Meals Out and Hotels	105.09%	more expensive
Transport	-1.73%	cheaper

This means, based on all the above factors, that a person would require a salary of 172,095 US Dollar (USD) in Caracas to have the same standard of living as currently enjoyed in New York on a salary of 100,000 US Dollar (USD ). This salary compensates for the overall cost of living difference of 42%, the hardship difference of 30% (Caracas 40% less New York 10%), and the exchange rate

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Venezuela, Caracas Cost of Living April 2010

Country Full Name: Bolivarian Republic of Venezuela.

Location: Venezuela is in Northern South America, bordering the Caribbean Sea and the North Atlantic Ocean, between Colombia and Guyana.

Country Climate: Tropical; hot, humid; more moderate in highlands.

Country Terrain: Andes Mountains and Maracaibo Lowlands in northwest; central plains (llanos); Guiana Highlands in southeast.

Major Languages: Spanish, indigenous languages.

Major Religions: Christianity.

Country Population: 28.1 million (2008 est.) 28.6 million (2009 est.).

Country Economy: The economy of Venezuela is dominated by the petroleum sector accounting for roughly a third of GDP, around 80% of exports and more than half of government revenues. Gold, diamonds and iron ore are mined as well. Venezuela contains some of the largest oil and natural gas reserves in the world. It consistently ranks among the top ten crude oil producers in the world.

Currency: Venezuelan Bolívar (VEB).

Country Inflation: 30.4% (2008 est.) 29.5% (2009 est.).

City: Caracas is the capital and largest city of Venezuela.

City Economy: Important industries in Caracas include chemicals, textiles, leather, food, iron and wood products. Caracas is a regional center for the distribution of products.
Cost of Living: Caracas has an overall cost of living index which equates it with high cost of living locations. The overall cost of living index is comprised of the prices for defined quantities of the same goods and services across all 13 Basket Groups. Caracas is currently ranked 7 overall, most expensive place in the world for expatriates to live, out of 282 international locations.

For more cost of living information on Venezuela, Caracas