Riyadh has been ranked the 57th most expensive city in the world, a significant increase from its 71st place last year; according to the latest Cost of Living Survey published by Mercer, a global consulting leader.

Dubai is seen as the 21st  most expensive city in the world, according to the survey, a rise of two places in comparison to last year, with Abu Dhabi, 25th  in world, changed from 33rd last year. A trend of GCC countries becoming more expensive can be observed as Manama, Bahrain sees its ranking at 71st, differing from 91st last year; Doha is 76th, up from 99th last year; Muscat comes in at 94th, jumping from 117th last year; Kuwait City is 103rd, also climbing from 117th position in 2015; lastly Jeddah is 121st, a change from 151st last year.

Rob Thissen, talent mobility consultant at Mercer Middle East, 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 US Dollar, with Riyadh for instance currently rated more expensive than Rome.”

The Middle East has multiple locations situated in the world’s top hundred, with a strong showing primarily from the GCC countries. Several cities experienced a jump in the rankings, as they are pushed up by other locations’ decline, as well as the strong increase for expatriate rental accommodation costs, particularly in Abu Dhabi and Jeddah.

One Levant city, Beirut, is positioned as the third most expensive city in the Middle East and 50th  globally, down from 44th last year; which is tied with nearby Amman, Jordan, also 50th, representing a rise of four places from last year.

“These rankings uniquely combine day-to-day expenditure on goods and services such as food, clothing and transportation, with rental prices.  While prices of most goods and services are considered to be cheaper in Saudi Arabia compared with Europe, it is the expatriate rental market that pushes cities like Riyadh and Jeddah up the ranking,” Thissen said.

“What this means is that once again, cities in our region have become more expensive to send people to, with expatriates expecting increased cost of living and housing allowances. To the contrary, when sending staff out of the Middle East, multinationals have to be wary that cost of living allowances are likely to go down, and have to clearly explain and communicate this to their staff to avoid lengthy discussions,” he added.