The Thick of It

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Tuesday, March 06, 2007

London rises to fourth in world's most expensive cities league

The Economist Intelligence Unit (EIU)today announced the results of it's ‘Worldwide cost of living survey’ which placed London fourth in the list of most expensive cities in the world to live. The top ten is below, with last year's position in brackets:

Rank City
1 (1) Oslo
2 (4) Paris
3 (6) Copenhagen
4 (7) London
5 (2) Tokyo
=6 (3) Reykjavik
=6 (8) Zurich
8 (4) Osaka
=9 (-) Frankfurt
=9 (10) Helsinki

However, according to UBS, London is the most expensive city.

These surveys take into account wages and cost of living, so while London has been found to offer high wages, these only matter if they translate into meaningful spending power. I find these surveys tremendously interesting because while London clearly is a very expensive place to live, the cost of many goods and services here are comparable to the rest of the EU.

The 1986 Single European Act was intended to achieve a level economic playing field across the EU. In terms of price this is starting to happen. Obviously, the Euro has played a major role in this. Market integration is highest in the Eurozone, though UBS reports that the price spread has fallen by a third in EU cities since 1985, a year before the SEA.

London undoubtedly earns well comparatively, but Labour's role is to ensure that all Londoners can share this prosperity. Does Valencia have an answer to keep the cost of city living and pollution down? They are investigating the possibility of producing ethanol from citrus peel as a fuel substitute for oil and petrol. I'm going to be watching this with interest as though London doesn't have the ability to grow citrus (yet), large parts of the EU does. This is something we could benefit from. Brazil already uses ethanol to run cars and reduce energy cost, so this could work.

2 comments:

Colm said...

Or Ken Livingstone could buy some cheap oil off Hugo and ship it over from Venezuala. Hmmm.

A Back to the Future III style energy from waste solution isn;t out of the question though.

Beth said...

I'm interested in why the Scandinavian countries are always at the top, though they also seem to top quality of life polls. I would have thought the two were contradictory.