There are several large cities in Pakistan, but Karachi is the largest with a population exceeds 12 million, according to the United Nations. Whilst the political capital of Pakistan is Islamabad, Karachi is definitely the economic center. It is home to the largest port in Pakistan situated in a sheltered natural harbor, and it is this which originally provided the conditions for the city to grow. Whilst the port continues to play an important part in economy of Karachi, the economy has diversified. Karachi is the location for the headquarters for many of the largest Pakistani companies, as well as being the location for the Pakistani offices of many international firms. Manufacturing plays a big part in the local economy, and increasingly outsourcing of services from richer countries plays a part, particularly with call centers. Pakistan has been ranked at number 20 on the 2009 A.T. Kearney Global Services Location Index of the most attractive outsourcing destinations in the world. All of these factors combine to result in Karachi having what has been claimed to be the highest average wage of any city in south Asia. However, despite the regionally high wages, Karachi is still located in south Asia, and so many of the prices for goods and services reflect this.
In addition, the excellent infrastructure links to the world further reduce the price of imported goods. These high wages, coupled with low prices of goods and services, result in Karachi being among the cheapest major cities in the world in which to live, not necessarily for the local residents, but certainly for the expatriates earning in hard currency. Here are Mercer's picks for the least expensive cities of the world in 2009:
1. Johannesburg, South Africa
2. Monterrey, Mexico
3. Asuncion, Paraguay
4. Karachi, Pakistan
5. Wellington, New Zealand
6. Auckland, New Zealand
7. Mexico City, Mexico
8. Quito, Ecuador
9. Chennai, India
10.Tunis, Tunisia
The survey covers 143 cities across six continents but concentrates mostly on Europe, Asia, and the Middle East. The only countries in the Americas covered were Canada, Mexico, Brazil, and the U.S. Mercer looks at more than 200 factors, including the cost of housing, transport and food.
Tokyo, last year’s second most expensive city, climbed to the top spot, knocking Moscow down to number 3. Geneva and Hong Kong ranked 4th and 5th, with Asian and European cities dominating the top 10 slots.
The survey, conducted in March, uses New York as the base city for the index, with currency moves measured against the dollar. New York itself jumped to 8th from 22nd last year.
“As a direct impact of the economic downturn over the last year, we have observed significant fluctuations in most of the world’s currencies, which have had a profound impact on this year’s rankings,” Nathalie Constantin-Metral, a senior researcher at Mercer, said in a statement on the firm’s website.
“Now that cost containment and reduction is at the top of most company agendas, keeping track of the change in factors that dictate expatriate cost of living is essential,” she added.
Tel Aviv ranked as the most expensive city in the Middle East, while Caracas was top in South America, and Sydney was the priciest city for expatriates in the Pacific.
Following are the top 10 most expensive cities, according to the Mercer survey. Last year’s rankings in brackets:
1. Tokyo, Japan (2)
2. Osaka, Japan (11)
3. Moscow, Russia (1)
4. Geneva, Switzerland (8)
5. Hong Kong, China (6)
6. Zurich, Switzerland (9)
7. Copenhagen, Denmark (7)
8. New York City, USA (22)
9. Beijing, China (20)
10.Singapore, Singapore (13)
Related Links:
Eleven Days in Karachi
AT Kearney Global Services Location Index
Outsourcing to Pakistan
Power Shortages in Pakistan
Karachi: The Urban Frontier
Garbage Collection in Karachi
Pakistan's Electricity Crisis
America's Best Run Cities
Emaar Bullish on Pakistan
Infrastructure and Real Estate Development in Pakistan
Karachi Dreams Big
Cost of Power Outages in India
