Dubai and Abu Dhabi are the most expensive cities in the GCC

The cost of living has risen sharply in both emirates according to a new survey.

Peter Iantorno August 30, 2015

The cost of living in Dubai and Abu Dhabi has increased sharply over the past year, according to the 2015 Mercer Cost of Living Survey.

After coming in 67th and 68th in the 2014 survey, Dubai and Abu Dhabi have rocketed up the rankings for this year, placing in 23rd and 33rd respectively.

The survey includes 207 cities across five continents and measures the comparative cost of more than 200 items in each location, including housing, transportation, food, clothing, household goods, and entertainment.

Dubai supermarket shopping.jpg Prices of essentials in Dubai and Abu Dhabi are on the rise.

The massive jump up the rankings (44 places for Dubai and 35 places for Abu Dhabi) will come as no surprise for most UAE residents, who have seen the recent increase in petrol prices and sky-high rates of inflation bump up the cost of living in the UAE significantly.

Plunging oil prices are often cited as a reason for the increase in living costs in the Gulf, but with Dubai and Abu Dhabi both rated as far more expensive than any other city in the GCC (Saudi capital Riyadh is the third most expensive GCC city in 71st place overall), UAE residents are clearly the ones suffering the most. 

According to the survey, the world’s most expensive city is, interestingly, Luanda. It is the third year in a row that the Angolan capital, where the average unfurnished two-bedroom apartment costs $6,800 per month to rent and a burger meal costs more than $17, has topped the list.

Luanda most expensive city in the world.jpg Luanda, the most expensive city in the world.

Although it might seem like an unlikely candidate for the world’s most expensive city, Luanda’s huge reliance on the oil industry, which provides more than half of Angola’s GDP, means that the city draws in a large number of expat oil industry workers, who pay a premium for imported goods and secure housing.

The rest of the top five is comprised of slightly more historically expensive cities, Hong Kong, Zurich, Singapore and Geneva. On the other end of the scale, the cheapest city in the world is Kyrgyzstani capital Bishkek, with Namibian capital Windhoek and the Pakistani city of Karachi completing the bottom three.