Prague ranked 90th most expensive city for expats in new 2021 index

Prague is the 90th most expensive country in the world for expats and among the top 30 in Europe according to the 2021 Mercer Cost of Living Ranking, a biannual report that examines the cost of living for international employees in major cities across the globe.

The Mercer report, one of the most comprehensive of its kind with more than 200 cities across the world included, is designed to help multinational corporations develop appropriate compensation packages for their expatriate employees.

A city's wealth is not the key component for a high cost of living. This year, Hong Kong has been displaced by Ashgabat as Mercer's most expensive city for expats. Economic woes and devaluation of the local currency have sharply driven up prices of consumer goods in Turkmenistan's capital across recent years.

Beirut rose 42 positions to reach #3 behind Hong Kong in this year's report. Impacts of Covid-19 on the local economy, as well as lingering effect from last year's Port of Beirut explosion, have contributed to record-high inflation in Lebanon.

Prague, meanwhile, has maintained a relatively steady position in cost of living rankings over the past few years. The Czech capital was ranked 83 in 2018 and 97 in 2019 and 2020 before moving up to 90 this year.

Among European cities, Prague ranks in the top 30, and among the V4 capitals it rates as the most expensive. The Czech capital is followed by Bratislava (110), Budapest (162), and Warsaw (164). Each of these countries, and many others in Europe, have moved up in this year's rankings.

Only three European cities feature in the top 10 in the cost of living index, however, and they're all in Switzerland: Zurich (5), Bern (8), and Geneva (10). More than half of the top 10 most expensive cities are in Asia, with Tokyo (4), Shanghai (6), Singapore (7) and Beijing (9) following Ashgabat and Hong Kong.

While Mercer's cost of living index by itself may not mean much for the average expat, evaluation alongside with the company's quality of living report, also conducted each year, makes for a good comparison:

Among a sample of selected cities in the above infographic (not a comprehensive list), only Vancouver, Canada ranked higher in the quality of living index and lower in the cost of living index than Prague.

European cities such Munich, Vienna, Amsterdam, Stockholm, Lisbon, and Barcelona all rate a high in the quality of living index while staying toward the middle in terms of cost of living. V4 capitals Budapest and Warsaw rate slightly behind Prague in quality of life, but significantly lower in cost of living.

These are Mercer's top 10 most expensive cities for expats, along with some additional cities of note for local readers: