Jake's View

Yes, Hong Kong’s an expensive city, but don’t put too much store by those cost of living surveys

Comparisons of costs for expatriate living in cities across the globe don’t always reflect the local reality – try eating noodles and taking the bus

PUBLISHED : Wednesday, 13 December, 2017, 2:06pm
UPDATED : Wednesday, 13 December, 2017, 10:55pm

According to the survey, a litre of petrol in Hong Kong costs US$2.13, 142 per cent higher than in New York. A cappuccino in Hong Kong costs US$4.77, 40 per cent more than in London, while beer at a local bar costs US$11.90, 41 per cent more than even in Luanda.

SCMP, December 13

Just what message we can take in from all these simplistic survey comparisons of expatriate living costs is a mystery to me, although I can understand why most of them are conducted.

ECA International, which sponsored this latest one, and does two of them a year, is a human resources consultancy (fancy name for a people broker) and gains publicity in its target client base by thus showing its knowledge of its business.

But I still say it is simplistic.

Take, for instance, this bit about petrol costing much more in Hong Kong than it does in New York. One reason is that we tax the stuff heavily, which the US government does not dare to do for fear of outright rebellion. We can thus have lower income taxes rates. How does this fit into ECA’s computations of comparative living costs?

I also cannot even imagine living in the US without owning a car. In many places I would be as badly stranded as on a desert island.

In Hong Kong, by contrast, private transport is a luxury. We have the world’s best public transport system and it is a bargain one, too, when the farthest distance you can travel across this town on the MTR costs you less than a one-stop hop on the London Underground.

I wonder about those petrol bills anyway. You may pay less at the pump in New York but you burn much more on the road. Driving distances are a great deal longer in the US than in Hong Kong.

Then we get to the bit about a cappuccino costing much more here than it does in London. How the Brits change. It used to be a cuppa when it wasn’t beer served flat and warm. From their mannerisms these days you would think all of London comes from Seattle.

Hong Kong is the 9th most expensive city in the world for expats, ahead of Singapore at 21st: survey

But what is the comparative price of a cuppa in New York and can you even get one? What about the price of a lai cha (milk tea) for a Hong Kong expat in New York, or must we all drink only cappuccinos these days?

Without signing up for its service, which I won’t, I cannot tell you on this occasion if ECA is still guilty of that ultimate piece of cultural arrogance of comparing fancy restaurant prices across the world for an almost raw slab of dead cow. Just the thought repels many more Asians than it attracts.

And as to beer costing even more in Hong Kong than it does in Luanda, well, at least Africans drink decent beer. If you send a sample of the stuff peddled in the US to your chemist you’ll get back a report saying your horse has kidney problems.

Rating different cities by expatriate living costs is a fundamentally flawed concept anyway. The most expensive are either so because of the extreme cost of making them liveable (Luanda) or so rewarding to enterprise that cost does not matter much (Hong Kong). Best and worst are equally costliest.

On a more fundamental level, however, the notion that economic progress is to some extent reliant on expatriate expertise may be true of a Luanda, but will someone please tell me what an expatriate can do in Hong Kong that someone locally born cannot now do? We no longer live in the 19th century.

If foreign corporations then find the cost of sending people here from their homelands too high, I have an easy solution. Don’t send them. Hire locally. If even local hires are then too costly, don’t come at all. It’s a high cost place because it’s a high reward place. Yours is obviously not a high reward business.

But here is the great secret. If you are an expatriate who is happy to eat noodles, drink tea, ride on the bus and organise yourself in a small flat, it’s not really such a costly place at all.