A 2024 ranking by Mercer, an American consulting firm, named Abuja the cheapest African city for expats to live.
According to the report, Nigeria’s commercial capital, Lagos, is ranked the second cheapest city on the continent, noting that it is among the cities that saw significant declines in the cost of living rankings for expats between 2023 and 2024.
It said Lagos dropped significantly by 178 places to 225th from 47th in 2023.
The Mercer report identified currency devaluations as the major factor that increased the affordability of Lagos for foreign professionals.
The local currency depreciated from 464/$ on June 9, 2023, ahead of the country’s foreign exchange market harmonization on June 14, 2023, which saw the naira weaken to 1483.31/$ on Friday.
He stated: “Many key factors have affected the global economy in recent years. In 2024, these factors continue to have an impact on the cost of living in major cities. Inflation and exchange rate fluctuations directly affect the pay and savings of internationally mobile employees (or those on an international assignment).
“Increased economic and geopolitical instability, as well as local conflicts and emergencies, have led to additional costs in areas such as housing, utilities, local taxes and education. In the case of the top-ranked cities (Hong Kong, Singapore and Zurich), factors such as expensive housing purchases, high transport costs and higher costs of goods and services contributed to the high cost of living.
“In contrast, in Islamabad, Lagos and Abuja the demonstrably lower cost of living of international transferees is due, in part, to currency devaluations.”
The report said cost of living was an important consideration for expats when choosing a city to relocate to, as their choices determine their quality of life and financial stability.
He added that the reductions in the cost of living of international expatriates brought about by the currency happened even as inflation had risen in countries like Nigeria and others.
Mercer ranked 226 cities in the world in order from the most expensive to the cheapest places to live.
He added: “The African cities ranked highest in the global cost of living city rankings are Bangui (14, up 12 places), Djibouti (18) and N’Djamena (21). The least expensive cities in the region include Blantyre (221), Lagos (225, down 178 places) and Abuja (226).
“The comprehensive ranking serves as a valuable compass, providing guidance on the complex cost-of-living landscape in cities around the world.”