Angola’s capital, Luanda, remains Africa’s most expensive city, and is the second most expensive for expatriates globally.
This is among the findings of the latest Cost of Living survey by ECA International, which provides information for the management and assignment of employees around the world.
While Luanda topped the list between 2007 and 2009, the top spot since then has been filled by Tokyo and now Caracas.
Luanda is followed by Juba (4), Brazzaville (13) and Libreville (17) – all of which also feature in the global top 20. The cost of goods typically purchased by international assignees in these locations are likely to be high due to export and transportation costs. In addition, the commodity boom in recent years has led to currency appreciations in commodity-exporting markets like Angola.
However, many more African cities are positioned towards the bottom of the ranking. Maseru in Lesotho is the cheapest location not only in Africa but worldwide.
The significant depreciation of the rand has contributed to the lower positions of South African cities and locations in countries where the currency is tied to the rand, including Lesotho.
Johannesburg has fallen 13 places over the year and is now in 249th position followed by Cape Town (254) and Durban (255). Kenya’s capital, Nairobi, is in 183rd position.
To ensure that their employees’ spending power is not compromised while on international assignment, multinational companies will often include a cost of living allowance in their pay package. Living costs for assignees are affected by inflation, availability of goods and exchange rates, all of which can have a significant impact on assignee remuneration packages.