Riga: Paris of the north indeed

  • 2002-07-11
  • Jorgen Johansson

Every expatriate working for a foreign company in Riga should start pressing for a better expense account.

According to a worldwide survey released this week by an international consulting firm that caters to firms sending workers abroad, Riga is the 22nd most expensive city in the world.

That puts it ahead of Paris, Geneva, Zurich and whole lot of other cities, according to the survey.

Go figure.

Those who did the figuring were statisticians at the well-respected international firm Mercer Human Resource Consulting, who ranked the world's most expensive 144 cities.

One explanation for Riga's rank - and that of Kiev, which came in 17th - is that the survey only tallied the prices of imported goods and posh restaurants and hotels, said senior researcher Marie-Laurence Sepede from the company's Geneva office.

"We have a basket of around 200 items we survey. Everything from food products to housing and hotels," Sepede said.

"But we only survey food and restaurants at a very high level."

Moscow, which is the second most expensive in the world according to Mercer's estimates, and St. Petersburg are the costliest cities in which to live in Europe.

Hong Kong, according to the survey, is the most expensive in the world.London (10th in the world) and Copenhagen (62nd) are the most expensive cities in the European Union.

The cheapest cities in EU are Madrid and Lisbon. The cheapest in the world is Johannesburg.

Paris finished 74th.

According to Sepede, the survey found that the introduction of the euro had little effect on cost of living in EU cities, although "before the euro arrived, there was concern that prices would be rounded up when converted," she said.

Helmuts Ancans, head of Latvia's Central Bank's monetary department, explained that Latvia is a very urban country with the main focus on its capital.

"Most business activities in Latvia are conducted in Riga. Riga's orientation toward foreigners is one factor that keeps prices high," Ancans said. "There are areas in Riga which are very extremely expensive, but on average I would say that Riga has the same prices as Tallinn and Vilnius."

Tallinn and Vilnius are one thing, but according to the survey Riga is more expensive than Geneva (28th), Zurich (32nd) and Milan (63rd).

"This survey has very little to do with reality," said Juris Kaza, a reporter with the business newspaper Dienas bizness.

The annual Mercer survey covers 144 cities spread out on every continent.

Neither of Latvia's Baltic neighbors had cities on the Mercer list.