Quality vs. Cost in Asia’s Key Cities

Mercer’s 2015 Quality of Living Rankings confirm some well-established insights into Asian cities. Singapore once again ranks the highest for quality of living, coming 26th globally. While Europe continues to dominate with Vienna securing the top spot, Singapore beats Washington, London and Tokyo. It will also come as no surprise that Mercer’s 2014 Cost of Living Rankings rate Singapore as one of the costliest Asian cities.

While these rankings reaffirm general patterns, they also point towards emerging trends on the cost of living vs. quality of living in key Asian cities. However, rankings alone can be notoriously superficial. In this article, we explore the trends which stand up to scrutiny.

China Highlights

In China, the usual suspects rank highest for quality of living – Shanghai 101st, Beijing 118th and Guangzhou 121st – comparable to cities in Malaysia and Thailand. Cost of living is significantly more expensive than Southeast Asia, however:  Shanghai and Beijing rank 10th and 11th respectively, which is even higher than London, while Guangzhou makes an appearance at 17th.

In fact, China’s second tier cities, such as Nanjing and Qingdao, form a consistent pattern for high cost of living coupled with low quality of living. In comparison to Southeast Asian cities, lower tier Chinese cities have significantly higher living costs (ranging between 45th to 70th) and much lower quality of living rankings (between 130th to 170th).

Southeast Asian Highlights

Within Southeast Asia, Malaysia stands out as an increasingly attractive option for relocation. It ranks highly on Mercer’s quality of living rankings, with Kuala Lumpur coming in at 84th and Johor at 103rd; relatively close to Hong Kong’s 70th.

Kuala Lumpur is a largely safe city, with threats mainly coming from petty crime. Public transport is extensive with an easy to navigate bus system, internal LRT and monorail lines and trains to other major Malaysian cities and Southeast Asian countries, such as Singapore and Thailand. Road conditions in Peninsular Malaysia are generally good. The Malaysian government is also investing in the regional and international health tourism industry and the standard of care is high but expensive.

Unlike in other Southeast Asian countries, the cost of living in Kuala Lumpur also remained relatively stable between 2013 and 2014, with its ranking rising only slightly from 111th to 115th. This situates the cost of living in the same bracket as Southeast Asian cities such as Jakarta (119th), Hanoi (131st) and Ho Chi Minh City (135th), where on the whole living costs tended to increase quite steeply year-on-year.

Bangkok, on the other hand, tends to fare rather poorly, with lower quality of living (117th) and higher cost of living (88th) than in Kuala Lumpur. Although Hanoi and Ho Chi Minh City have the lowest cost of living across Southeast Asia – 131st and 135th respectively – among this group they also rank lowest for quality of living.

Manila, like Kuala Lumpur, is another exception. Quality of living is middling – lower than its counterparts in Malaysia and Thailand but higher than Indonesia and Vietnam. Cost of living, however, remains amongst the lowest in the region and, more significantly, the average monthly salary of project management professionals in the Philippines comes in at US$3,314 per month; a strong rival to Malaysia’s US$3,839 given the wide disparity in living costs.

Overall, not only are Southeast Asian cities proving themselves better value than those in China, but both Manila and Kuala Lumpur stand out as particularly formidable alternatives to Singapore and China’s big four.

 

Originally published as ‘Quality and Cost of Living Reports Point Towards Emerging Trends in Asia-Pacific’ on Asean Briefing, 18 March 2015.

Words: Rebecca Choong Wilkins

Image: Matthew Niederhauser

 

%d bloggers like this: