Global food prices are rising again according to the World Bank

Global food prices increased by 8 percent from December 2011 to March 2012 due to higher oil prices, adverse weather conditions, and Asia’s strong demand for food imports, according to the World Bank Group’s latest Food Price Watch. The World Bank’s Global Food Price Index was only 1 percent below a year ago and 6 percent below the February 2011 historic peak. If the current forecasts for increased food production do not materialize, global food prices could reach higher levels, underscoring the need to remain very vigilant.  “After four months of consecutive price declines, food prices are on the rise again threatening the food security of millions of people,” said Otaviano Canuto, World Bank Vice President for Poverty Reduction and Economic Management (PREM). “Putting food first must remain a priority for the international community and in our work in developing countries.” According to the quarterly Food Price Watch report, prices of all key staples increased between last December and March of this year, except for rice, due to both abundant supply and strong competition among exporters. Maize prices increased by 9 percent, soybean oil by 7 percent, wheat by 6 percent, and sugar by 5 percent. Crude oil prices rose by 13 percent. In addition, domestic food prices remain high, especially in Africa as the result of a combination of large food imports and local factors, such as trade restrictions between neighbors, hoarding, civil unrest, high fuel transportation costs and bad weather conditions. In a global context, domestic food price increases have been larger than price declines across countries.  Wheat prices from March 2011 to March 2012 rose 92 percent in Belarus, while the price of maize increased by 82 percent in Malawi, 80 percent in Ethiopia, and 71 percent in Mexico. Production outlooks remain strong for 2012/13 and a number of factors have kept pressures on prices at bay. Record prices in late 2010 and early 2011 led to increased production of major crops worldwide, and are a key factor in the strong projections for the 2012/13 season. The slowdown in maize use for ethanol production in the U.S. and weak global demand due to the euro crisis are contributing to keeping upward price pressures on check.

The top 20 most expensive places to live in Europe in 2012

The most expensive place to live in 2012 is Zurich based on the overall cost of living excluding housing, education, healthcare and transport costs.

The latest international cost of living rankings are based on data collected during the past 3 months for 768 international locations, covering every country world-wide.

The cost of living data collected is representative of an expatriate lifestyle, while the components of COL are prices for fixed quantities of the same goods and services, inflation and exchange rates. Prices in each location are affected by availability (i.e. supply & demand) as well as local pricing regulations and taxes on goods and services (e.g.premiums on luxury brands). Local inflation is usually representative of local price increases which in turn impacts an expatriates purchasing power in the host country. The exchange rate impacts both the price of imports to the host country and the expatriate assignment salary calculation between the home and host country. The cost of living has a significant impact on the purchasing power of an expatriate’s salary package.

The overall cost of living excluding housing, education, healthcare and transport costs is often used to calculate the cost of living for expatriate employees.  During an expatriate assignment housing, education, healthcare and transport costs are often either paid by the employer or through an allowance.

Of the top 50 most expensive places to live based on the cost of living excluding housing, education, healthcare and transport, Europe has 19 locations, the Americas 16, Asia-Pacific 10, and Africa 5.

The top 20 Most expensive places to live in Europe - Overall Cost of Living & All Baskets:

1. Switzerland, Zurich
2. Switzerland, Geneva
3. Switzerland, All Areas
4. Norway, Oslo
5. Liechtenstein, Vaduz
6. Norway, All Areas
7. Liechtenstein, All Areas
8. United Kingdom, London
9. Denmark, Copenhagen
10. Denmark, All Areas
11. Russia, Moscow
12. Monaco, Monaco
13. France, Paris
14. Austria, Vienna
15. Jersey, Saint Helier
16. Jersey, All Areas
17. Italy, Rome
18. Finland, Helsinki
19. Germany, Frankfurt
20. Austria, All Areas

The top 20 Most expensive places to live in Asia-Pacific - Overall Cost of Living & All Baskets

Much of the developed world has historically embedded high cost of living structures that keep them amongst the most expensive places to live. Europe and America have 22 locations in the top 50 based on the overall cost of living index and 35 out of 50 places based on the cost of living excluding housing, education, healthcare and transport. The major factor contributing to this is the relatively higher level of pay in the developed world, particularly amongst lower level jobs. By contrast Africa, Asia-Pacific, the Middle East and South Asia have 28 places in the top 50 based on the overall cost of living index but only 15 out of 50 places based on the cost of living excluding housing, education, healthcare and transport, of the 15, 8 are in Australia and Japan.  

The top 20 Most expensive places to live in Asia-Pacific - Overall Cost of Living & All Baskets

1. Japan, Tokyo
2. China, Hong Kong
3. Japan, Yokohama
4. Japan, Osaka
5. Australia, Sydney
6. Japan, Nagoya
7. Japan, Kobe
8. Japan, Kyoto
9. Australia, Canberra
10. Japan, Kawasaki
11. Singapore, Singapore
12. Japan, Fukuoka
13. Australia, Perth
14. Australia, Melbourne
15. China, Shanghai
16. Japan, All Areas
17. Japan, Sapporo
18. Australia, Brisbane
19. New Zealand, Wellington
20. New Zealand, Auckland

Cost of Living Excluding Housing, Education, Healthcare and Transport

As the overall most expensive place to live, Tokyo has an overall cost of living index of 153.65, followed by Hong Kong with 144.18, and Zurich with 139.57. The overall index is comprised of 13 different basket groups. The assumption using the overall index is that everything is paid from the salary package. In addition, the cost of living calculations are weighted according to typical monthly international expatriate spending patterns. The Household Accommodation Basket for example, has a weighting of 30%, while the Groceries Basket has a weighting of 16.5%. That means that an international expatriate who, for example, earns 10,000 would typically spend 3,000 (30% of 10,000) on housing and 1,650 on groceries.


In many international assignments, basket groups such as housing, education, healthcare and transport are provided for by the employer, either in kind or in the form of an allowance over and above the salary. If we take these basket items out of the cost of living calculation, the cost of living indexes change accordingly. On this basis the current cost of living index for Tokyo becomes 58.63, Hong Kong 42.31 (dropping all the way to rank 187) and Zurich 64.51. For an expatriate, where these benefits are provided for them, Zurich is the most expensive city to live.


Switzerland and Japan dominate the rankings primarily due to their strong currencies which have made them relatively more expensive. Local inflation is far less of an influence on cost of living compared to changes in exchange rates. The impact of a strong currency is that imports become cheaper. For locally employed people, especially when purchasing imported goods and services, the cost of living may not seem to have a major negative impact. In fact overseas holidays become relatively cheap. However, it also means that Japan and Switzerland, as well as countries like Australia who have 6 cities in the top 50 based on overall cost of living, are relatively more expensive for those paying with foreign currency which impacts exports and the overall cost to an employer sending an assignee to work in these countries.


In addition to the impact of strong currencies, much of the developed world has historically embedded high cost of living structures that keep them amongst the most expensive places to live. Europe and America have 22 locations in the top 50 based on the overall cost of living index and 35 out of 50 places based on the cost of living excluding housing, education, healthcare and transport. The major factor contributing to this is the relatively higher level of pay in the developed world, particularly amongst lower level jobs. By contrast Africa, Asia-Pacific, the Middle East and South Asia have 28 places in the top 50 based on the overall cost of living index but only 15 out of 50 places based on the cost of living excluding housing, education, healthcare and transport, of the 15, 8 are in Australia and Japan.


To provide an assignee, sent to any of the most expensive countries, with a similar purchasing power to what they have in their home country, requires an adjustment to their assignment salary. The amount of adjustment depends on which country they come from. The larger the difference in cost of living, the larger the adjustment required to ensure a similar level of purchasing power in the host country.

Of the top 50 most expensive places to live based on the cost of living excluding housing, education, healthcare and transport, Europe has 19 locations, the Americas 16, Asia-Pacific 10, and Africa 5. The most expensive city in the Middle East is Manama ranked 58, while in South Asia it is Kathmandu ranked 484.


The top 50 Most expensive places to live - Excluding Housing, Education, Healthcare and Transport Baskets:

1. Switzerland, Zurich
2. Switzerland, Geneva
3. Switzerland, All Areas
4. Russia, Moscow
5. Brazil, Sao Paulo
6. Japan, Tokyo
7. Norway, Oslo
8. Brazil, Rio de Janeiro
9. Venezuela, Caracas
10. USA, New York (Manhattan) NY
11. Central African Republic, Bangui
12. Norway, All Areas
13. Australia, Sydney
14. Liechtenstein, Vaduz
15. Australia, Canberra
16. USA, New York (Brooklyn) NY
17. Liechtenstein, All Areas
18. Denmark, Copenhagen
19. Brazil, Brasilia
20. USA, Honolulu HI
21. Denmark, All Areas
22. Australia, Melbourne
23. Venezuela, All Areas
24. Australia, Perth
25. Monaco, Monaco
26. New Caledonia, Noumea
27. Senegal, Dakar
28. Gabon, Libreville
29. Solomon Islands, Honiara
30. Russia, Vladivostok
31. France, Paris
32. USA, New York (Queens) NY
33. Cayman Islands, All Areas
34. Canada, Toronto
35. USA, San Francisco CA
36. Italy, Rome
37. Australia, Brisbane
38. Japan, Osaka
39. Japan, Yokohama
40. Azerbaijan, Baku
41. Angola, Luanda
42. Central African Republic, All Areas
43. USA, New York NY
44. USA, Hawaii All Areas HI
45. USA, San Jose CA
46. Canada, Vancouver
47. Austria, Vienna
48. Russia, Kaliningrad
49. Russia, St. Petersburg
50. United Kingdom, London