Dubai, Abu Dhabi among world's most expensive places for expats: survey

Dubai and Abu Dhabi of the United Arab Emirates (UAE)) have been ranked the 21st and 25th most expensive cities for foreign workers (expatriates or expats) to live in the world, according to Mercer's 2016 Cost of Living Survey released on Wednesday.

Dubai with its 2.5 million inhabitants saw a rise of two places in comparison to last year. And Abu Dhabi (1.5 million people), changed from 33rd place last year to 25th, despite the ongoing slump of oil prices.

"The two UAE cities have experienced a rise in their world rankings in this respect, following the wider Middle Eastern trend of Gulf Arab countries becoming more expensive, said the e-mailed report.

Talent Mobility Consultant at Mercer Middle East, Rob Thissen, said "The main reason Dubai and Abu Dhabi, and in fact almost all cities in the Middle East increased in rank, is that their currencies are pegged to the U.S. dollar, with Riyadh for instance currently rated more expensive than Rome."

All Gulf Arab economies, with the exception of Kuwait have pegged their currencies to the greenback.

Thissen added "These rankings uniquely combine day-to-day expenditure on goods and services such as food, clothing and transportation, and rental prices."

The costs of living increased in recent months in the UAE after the government cut a number of subsidies and introduced new fees for living and doing business to cushion the fall of oil revenues.

Economies in the Gulf region witnessed a slowdown in economic growth in the last six months due to the ongoing slump of the price of oil. Endit