Tue, Jun 15, 2004 - Page 6 News List

London leaps to No. 2 on most-expensive city list


London has leapfrogged its way up the cost-of-living league to become the second most expensive city in the world.

From the price of a morning coffee to the rent on a two-bedroom apartment, on average only Tokyo will make more of a dent in your wallet.

Last year London was rated only seventh most expensive on the list of 144 international cities, behind Tokyo, Moscow, Geneva, Osaka, Hong Kong and Beijing. But the steady appreciation of the pound against the US dollar, allied with high accommodation and transport costs, has pushed it up the list.

The survey found the cost of renting a luxury unfurnished two-bedroom apartment in London was ?1,950 a month, compared with ?840 in Dublin, ?1,311 in Paris and ?908 in Rome.

A spokeswoman for Mercer Human Resource Consulting, which carried out the research, said however that the results were based on the cost-of-living for expatriates, who are more likely to stay in central London, where accommodation is most expensive.

The survey ranks the cost of living for foreign workers by pricing 200 items in 144 cities, including housing, food, transport and entertainment. With New York as the base city, scoring 100 points, Tokyo scored 130 and London 119 points. At the bottom of the league table, the results revealed that Tokyo is more than three times as expensive as the lowest-ranked city, Asuncion, capital of Paraguay, which scored 42 points.

The survey found that the gap between the world's most and least expensive cities has narrowed only marginally this year, by less than two points compared with four points last year and 15 points in 2002.

Some of the cheapest European cities were in countries which joined the EU last month.

"We are likely to see cities in the new EU accession countries rise in the rankings as more investment is made in commercial development, and standards of living increase," said Marie-Laurence Sepede, a senior researcher at Mercer.

"There have been some dramatic movements in the rankings this year which are largely due to currency fluctuations, particularly of the US dollar and the euro," she added.

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