Beijing is the most expensive city on the Chinese mainland for expatriates, ranking the 20th highest in the world for costs of living, according to an annual report released by Mercer, a US-based consulting company.
While housing remains the biggest expense for expats from transnational corporations, the price of schooling, healthcare and buying imported goods remains higher than other cities in the region.
“Prices of imports including clothes and electronics are about 10 to 40 percent higher than in Singapore as they are heavily taxed,” said Kin Soon Cheong, a Singaporean expat working for an engineering corporation.
Mercer surveyed 214 cities, including nine in the Chinese mainland, and found Beijing, Shanghai and Guangzhou are the three most expensive. The survey is used by multinational companies, governments and NGOs to calculate pay and allowances for expat employees.
Beijing is now even more expensive than New York City (32nd) and Paris (27th), but not quite as expensive as 18th-placed London. The survey takes into account the cost of goods and services including alcohol and tobacco, sports and leisure, utilities, clothing and accommodation.
Mercer said the survey is based on expatriates’ life patterns, and the price of goods is collected from three types of stores – discount stores, supermarkets and fine stores.
“For example, we go to stores frequented by the expat population, and select international brands for comparability purposes,” said Nathalie Constantin-Métral, senior researcher at Mercer.
“For accommodation, we include the price for houses and apartments in areas favored by expatriates,” she said.
Foreigners sent to China are mostly senior-level employees, and their companies usually offer allowances to cover housing, schooling and transportation, said Gong Lili, senior consultant at Antal International, a British consulting company in Beijing. These expenses are often many times higher than for other foreigners in Beijing who organize employment by themselves, and do not have what is referred to as a “full expat package.”
“Expats have an average housing allowance of 10,000 to 15,000 yuan ($1,549 to $2,323) per month, and more than 100,000 yuan each year if they have children in school,” Gong said. Residential rental prices in Beijing and Shanghai have been increasing over the past six months, said the survey