2023年全球生活成本報(bào)告

Contents

Introduction

4

Calculatingcostofliving

Pricecollection

Weights

CalculatingECA’scostoflivingindices

Costoflivingaroundtheworld

7

8

10

12

Applyingcostoflivingindices

Home-basedapproach

Net-to-netapproach

Choosinganindextype

Spendableincome

16

17

18

21

Understandingcostoflivingchanges

Pricemovements

Exchangerates

Indexchangecasestudies

26

28

30

MorefromECA

Howtobuycostoflivingdata35

FurtherdataandservicesavailablefromECA36

Aboutthisreport38

?EmploymentConditionsAbroadLtd3

Introduction

Whenmovingtoliveandworkinanothercountry,costoflivingisafactorthatcannotbeignored.Thecostofmaintainingalifestylesimilartotheoneexperiencedathomecanbesignificantlyhigherorlowerinadifferentlocation.Sometimescostsarehighersimplybecauseitcanbedifficulttoshopascosteffectivelyinanunfamiliarplace.Goods

ofthestandardexpatriatesareusedtomaybeimported,whichcanmakethoseitemsexpensiverelativetoothercountries.Governmentpoliciescanalsodirectlyaffectprices,forexamplebyprovidingfuelsubsidiesorapplyingconsumptiontaxeslikeVAT,makingthemhigherorlowerthanforthesameproductselsewhere.Exchangeratesalsohaveabiginfluenceoncomparativelivingcostsastheydirectlyaffecthowmuchyoucanbuywithyourmoneyabroad.

Costoflivingandmobility

Nobodyknowinglyundertakesan

internationalassignmentthatwillmakethemworseoff.Mostemployeesneedreassurancethattheirstandardoflivingwillbeprotectedbeforeuprooting

themselves(andpotentiallytheirfamily)

tomovetoanothercountry.Theglobalmobilityteamsthatmanagepayfor

internationalassigneesneedreliablecostoflivingdatatocalculatefairandequitablesalariesthatcanbeeasilyupdatedtomanagerelativechangesinpricesandexchangerates.

ECA’scostoflivingindicesgiveacomparisonoflivingcostsbetweentheassignee’shomeandhostlocations.Theycanbeusedtocalculateahome-basedassignmentsalary,whichisdesignedtomaintainanemployee’shomespendingpowerwhile

theyareoninternationalassignment.Alternatively,theycanbeusedinanet-to-netcomparisonofhomeandhostsalariestodeterminewhetheralocalsalarywillprotecttheassignee’sstandardoflivingonassignmentorwhetherfurtherallowancesarerequiredtomakeupthedifference.Bothapproachesarecoveredinmoredetailonpage14.

Managingcostofliving

volatility

Exchangeratesandpricesareinconstantflux,witheconomicconditions,politicaleventsandgovernmentpolicesallhavinganimpact,aswehaveseeninrecentyearswiththeCovid-19pandemicandthewarinUkraine.Changesinthevalueofacurrencywillhaveadirectimpactonrelativecosts,whilerecenteventshaveshownthatnooneisimmunefromhighinflation.Asaresult,relativelivingcostsaroundtheworldareconstantlychanging,whichprovidesachallengeforinternationalorganisationsthatneedmobiletalenttoachievetheirbusinessobjectives.

Theimpactofcostoflivingchangesonanassigneewillalsovarydependingonthecurrencyinwhichtheyarepaid.Iftheyarepaidinhomecountrycurrency,andthatcurrencyhasrecentlydevalued,theywillnowneedmoreofittomaintainthesamestandardoflivinginthehostcountry.Ifitisthehostcurrencythathasdevalued,theywillfeelbetteroffbecausetheycannowbuymorewiththesameamountofhomecurrency.Ontheotherhand,iftheyarepaidinhostcountrycurrencytheirstandardoflivinginthehostlocationwillnotbedirectlyaffectedbyadevaluation.However,iftheyhaveongoingcommitmentsinhomecountrycurrency(mortgagerepayments

4ECAGlobalPerspectivesCostofLiving

forexample),theywillhavemoreorlessmoneytoremitthanbefore,dependingonwhichcurrencyhasdevalued.

ECAandcostofliving

ThisreportexplainshowECAcalculatescostoflivingindicesforaround500locationsinourtwice-yearlysurveystoproduceaccuratedatathatissimpletoapplyandunderstandyetflexibleenoughtoadapttotheneedsofdifferentnationalities,familysizesandassignmentpolicies.Italsolooksatbestpracticeinapplyingcostoflivingindicesandexaminestheresultsofrecentsurveystoexplainhoweconomiceventscaninfluencerelativelivingcostsaroundtheworld.

"Nobodyknowingly

undertakesaninternational

assignmentthatwillmake

themworseoff”

Alltheindicesusedandquotedinthisreport,

unlessotherwisestated,arestandardhome-

basedindicestakenfromECA’sSeptember

2022costoflivingsurvey.Whereapplicable,

currencyconversionshavebeenmadeusing

theSeptember2022surveyexchangerate

whichisanaverageoftheexchangerate

publishedbyOANDAduringtheperiod22

August-5September2022.

?EmploymentConditionsAbroadLtd5

Calculatingcostofliving

6ECAGlobalPerspectivesCostofLiving

ECAcarriesoutsurveysoflivingcostsaroundtheworldtohelpmultinationalorganisationscalculateappropriatesalarypackages

whentheiremployeesgoonan

internationalassignment.

Intotal,weconductfoursurveyseveryyear–twoinMarchandSeptemberforalllocationsandtwoinJuneandDecemberforhighinflationlocations.Surveyresultsarepublishedintheformofcostoflivingindices,whichcomparethelivingcostsintheassignee’shomelocationwiththoseinthehost.Anindexof160,forexample,wouldmeanthatthehostlocationis60%moreexpensivethanthehome(whichisalways100).Whenappliedtosalarieseffectively,costoflivingindicesenableassigneestomaintaintheirusuallevelofbuyingpowerwhilelivinginacheaperormoreexpensivelocation.

Inordertocalculatecostoflivingindices,pricesarecollectedforabasketof170+everydaygoodsandservicesinthe500locationsthatECAsurveys.Averagepricesinthehomelocationarethencomparedtopricesofthesameitemsinthehost.Eachitemintheindexisgivenaweightthatreflectsitsrelativeimportanceinthehomeconsumptionpattern,e.g.fooditemsaregivenahigherweightingthanleisureitems,becausehouseholdsgenerallyspendalargerproportionoftheirincomeontheformerthanthelatter.Thisensuresthatthepricedifferentialforindividualitemsinfluencestheindextoanappropriateextent.

Pricecollection

Weusearangeofapproachestocollectthepricedatathatisusedtocalculateindices:ECA’steamofinternationaldataresearchers,onlineresearch,fieldresearchcompaniesandassigneesworkingforclientcompanies.Thisenablesustocrossreferenceforconsistencyandcheckforbias.Italsoenablesustocoverawiderrangeoflocationsandhelpsmaintainsamplesizestoensuregreaterstatisticalreliability.

ECA’sresearchers

Ourteamofresearchersspendmostoftheirtimetravellingaroundtheworldcollectingpricesforfoodanddrink,householditems,services,transport,accommodationandmore.Notonlydotheybringbackpricesfromthelocationstheyvisitbutalsoupdatesregardingnewdevelopmentsandchangestooutletswhichmayhavemoved,closedorrecentlyopened.Thishelpstoinformourotherdatacollectionapproachesandalsofeeddirectlytotheanalysis.

Onlineresearch

Wearealsocommittedtoreflectingtrendsinassigneeshoppingpreferencesandas

morepurchasesarebeingmadethrough

onlineoutlets,collectingthisdatahas

becomeincreasinglyimportant.The

amountofremotedataitispossibleto

collectonlineincreasedasaresultof

theCovid-19pandemic.Asglobaltravel

restrictionscameintoforce,in-person

pricecollectionwasalessviableoption.

Theglobalavailabilityofonlineoutlets

hasrapidlyexpandedandimprovedin

recentyears,meaningthishasbecomeanincreasinglyimportantapproachforcollectingcostoflivingdataaroundtheworld.

Fieldresearchers

WorkingwithnetworksofdatacollectionorganisationsenablesECAtoextendthebreadthanddepthofitsdata.Weensureagentsarewell-briefedinexactlytheitemsandoutletswewishtopricebasedontheinformationwereceivefromexpatriatesandourownresearcherswhohaveexperiencethere.Ourexperiencedteamofcostof

livinganalystsvigorouslycheckforanyirregularitiesinthedatareturned.

Expatriates

Whenwerunourcostoflivingsurveysweaskcompaniestoinvitetheirassigneestogetinvolved.Byinvitingthemtorecordthepricesofitemsintheoutletstheyregularlygoto,wenotonlygetatruepictureofwhereandhowtheyshopbutalsogivethemanopportunitytohavesomeinvolvementinhowtheircostoflivingallowancesarecalculated.The

questionnairesreceivedfromassigneesaresubjectedtoathoroughverificationprocess.Pricesarecheckedagainsteachotherandagainstpreviousyearstoensurevalidityandtopickupanyanomaliesorcollusionbetweenassignees.

?EmploymentConditionsAbroadLtd7

Weights

Eachiteminthecostoflivingbasketisassignedaweightthataccountsfortherelativeexpenditureofa

typicalhouseholdonthatitem

inthatcountry.Theweightsarederivedusingdatafromgovernmenthouseholdexpendituresurveys

andareupdatedeverysixmonths.ECApublishesthreetypesofcostoflivingindex:standardhome-based,cost-effectivehome-basedandcost-effectiveinternational.Thetwohome-basedindicesreflecttheconsumptionpatternofanassigneeintheirhomecountry.

Inmeasuringthecomparativecostoflivingaroundtheworlditisimportantthatanidenticalbasketofgoodsisreferencedineachlocation.Ahome-baseditem

weightingstructureallowsECAtoadd

region-focuseditemstoproduceatrulyinternationalbasketwithoutcompromisingontheconsistencyandaccuracyofthemeasurement.Forexample,misoishighlypopularinAsia,particularlyinJapan,butmuchlesssoinEurope.TheflexibilityofECA’shome-basedapproachenablesaweightallocationformisothataccuratelyreflectsitsgreaterimportanceforJapanesenationals,andanegligibleweightallocationforthoseonassignmentfromcountriessuchasSpainorItalywheretherelativepriceofmisoisunlikelytoaffecttheircostofliving.

Theitemsinthecostoflivingbasketcanbeputinto12groupsofexpenditure.Thefirstcolumnofthechartoppositeshowstheaverageweightsforthesegroupsacrossallcountrieswherehouseholdexpendituredataisavailable.Globally,thefoodgroup(includinggroceries,dairyproduce,meat&fishandfreshfruit&vegetables)accountsforalmostaquarterofexpenditureon

itemsinthebasket.Themotoring,mealsoutandutilitiesgroupsalsohaveprominentweightings,witheachaveragingmorethan10%ofbasketexpenditure.Groupssuchasleisureservices,alcohol&tobacco,recreationalgoodsandelectricalgoodsmakeuponaverage3%ofexpenditureeach.Thisdistributionofweightsgivesanindicationofhowpricemovementswithineachgroupcanhaveavariableimpactonacostoflivingindex.

Thedistributionofweightscanchangesignificantlyovertimeashouseholds’

spendingbehaviourevolves.Forexample,

inrecentyearswehaveseenadecreaseintheaverageamountspentoncigarettesinmanycountries,linkedwiththetighteningoftobaccoregulation.Overthelastfiveyears,wehavealsoseenanincreaseintheaverageamountspentongeneralservices.Thiscanbelargelyattributedtoexpenditureoninternetbroadbandandmobilephonecontractpackageswherehavingconsistentaccesstointernetservicesandbeing‘online’isastapleofmodernsociety.Growing

trendsandtechnologicaladvancementsnecessitateacontinuousre-evaluationofthegoodsandservicesinthecostof

livingbaskettoensurethattheitemsbeingmeasuredremainrelevanttomosthouseholds.

Geographicvariations

Asthechartoppositehighlights,consumptionpatternsdifferconsiderablybetweencountries.Expenditureonfooditemseatenathomerangesfrom15%inaSingaporehouseholdto42%foratypicalfamilyinthePhilippines.

Thereisacleardistinctioninexpenditure

patternsbetweenAsianandWestern

countrieswithinthefoodbasket,particularlyformeat&fish.Forexample,ChinaandthePhilippinesshowthehighestexpenditureonmeat&fishat13%oftotalexpenditure,whereasAustria,GermanyandtheUSshowonly4%oftotalexpenditure.

ExpenditureonmealsoutisalsonoticeablyhigherinAsia.Theaveragespendonmealsoutintheregionis21%oftotalexpenditurewithatypicalfamilyinHongKongspending34%,almostdoubletheirexpenditureoffoodathome.Comparatively,Europeansspendonaverage11%oftotalexpenditurewithHungariansonlyspending6%.

Motoringcostsandfuelinparticularaccountforalargeproportionoftotalexpenditureinmostcountries.Forexample,inMalaysia19%ofahousehold’sexpenditureisallocatedtovehiclerunningcostscomparedtoaglobalaverageexpenditureof12%.Thereareexceptionsthough.HongKong,withitssmallgeographicareaandexcellentpublictransportinfrastructureallowshouseholdstolimittheiruseofpersonalvehicles.Here,motoringcostsonlytakeup4%of

expenditurecomparedto7%spentonpublictransport.

8ECAGlobalPerspectivesCostofLiving

Percentageofgroupweight

Variationingroupweightsbyhomecountry

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

GlobalAustraliaBrazilGermanyHongKongJapanSouthAfricaUKUSA

Food

Generalservices

Clothing

Mealsout

Householdgoods

Leisureservices

Electricalgoods

Utilities

Recreationalgoods

Alcohol&tobacco

Motoring

Publictransport

Effectonindices

ThisvariationinweightsbetweencountriesisakeyreasonwhyECA’smeasureofinflationcandifferfromofficialsources.Equally,inflationwillvaryfordifferentnationalitiesinthesamecountry.

Forexample,ricerepresents3%of

expenditureonbasketitemsforan

assigneefromThailand.Incontrast,the

weightforriceinGermanyandNorway

isonly0.1%ofthebasket.Ifthepriceofriceincreasessubstantiallyinaparticularcountry,allresidentswillnoticetheincreasebutexpatriatehouseholdsfromThailandwillfeeltheimpactmoredeeplythanthosefromGermanybecausetheyallocatealargerproportionoftheirincometorice.Allotherthingsbeingequal,theindexforThaiassigneeswillthereforeincreasemorethanthatforGermanassigneeslivinginthesamecountry.

Internationalspending

patterns

Akeyassumptionwithhome-basedindices

isthatassigneesmaintainthesamehome

consumptionpatternwhileonassignment.

Forassigneesthatdonothaveastrongtie

totheirhomelocation,suchasthosewho

haveundertakenmultipleorconsecutive

assignments,thisassumptionmaynotbe

reasonable.ECAthereforealsocalculates

cost-effectiveinternationalindicesusingthe

averagespendingpatternacrossseveral

countrieswithinthesameregionasthe

homecountry.Byaveragingoutnational

extremesinitemweights,indicestendto

belowerthanhome-basedindicesthat

usenationalweights.

?EmploymentConditionsAbroadLtd9

€

￠

ECA’sresearchers●Fieldresearchers●Expats

●Onlineresearch

￥

E

JAPANCONSUMPTIONPATTERN

INDEX=100

INDEX=80

?

CalculatingECA’scostoflivingindices

￠

1

β

Usemultiplesourcestocollectaround400000pricesfromallovertheworldeveryMarchandSeptember

2

Calculaterepresentativepricesfor

170+goodsandservicesinECA’s

costoflivingbasketinaround

500locations

3

Convertrepresentativepricesto

acommoncurrency

4

Calculateanitemindex

foreachitem=hostpricehomeprice

x100

UKCONSUMPTIONPATTERN

5

Determinerelativeweightsusing

governmenthouseholdexpenditure

surveys

Produceweightedaveragesofitem

indicesusinghomecountryrelative

weightsorinternationalaverage

consumptionpatterns

6

Publishindextoshowrelativecosts

foreachhome/hostcombination

(home=100;index>100showshost

locationmoreexpensive;<100host

ischeaper)

INDEX=125

10ECAGlobalPerspectivesCostofLiving

85%

ofcompaniesusingthehome-basedapproach

payacostoflivingadjustment

Costoflivingaroundtheworld

Usingthemethodologyoutlinedinthissectionofthewhitepaper,thismapshowsa

snapshotoftherelativecostoflivingofcountriesaroundtheworld.Usingacomposite

baseofseveralcountriesitcomparesthecostofeverydaygoodsandservicesinnearly

200countriesaroundtheworldwherethebaseissetto100.Thecountriesaregraded

accordingtothemostexpensivecitywithineachone.

Index(base=100)

>160

140-160

130-140

120-130

110-120

100-110

90-100

<90

12ECAGlobalPerspectivesCostofLiving

?EmploymentConditionsAbroadLtd13

77%

ofcompaniesdonotapply

negativeindices

Applyingcostoflivingindices

?EmploymentConditionsAbroadLtd15

Tax&socialsecurity

Assignmentbene?ts

(accommodation,

educationetc)

Notionalhomesalary

Tax&socialsecurity

Assignmentallowances

Housing&savings

COLA(±)

Spendableincome

Nethomesalary

Hostpackage

Housing&savings

Spendableincome

Gross

assignment

salary

Net

assignment

salary

Costoflivingindicesaredesignedtoensurethatanemployee’sspendingpowerismaintainedwhentheyareonaninternationalassignment,whilepreservingtheirhomecountryhousingandsavingsobligations.

ECApublishesawiderangeofcustomisableindicesforeach

availablehometohostcombinationtosuitdifferentpoliciesand

assignmentobjectives.

Home-basedapproach

Costoflivingindicesaremostcommonlyusedinhome-basedassignmentsalarycalculations.Whenemployeesgoon

assignment,mortgagerepaymentsand

paymentstopensionsandsavingsfundsinthehomecountrymaycontinue,butday-to-dayspendingwillchangebecauseofthedifferentpricesandavailabilityofgoodsinthehostlocation.Inthehome-basedapproach,hypotheticaltaxandsocialsecurityisdeductedfromthehomecountrygrosssalaryandthecostoflivingindexisappliedtoaportionoftheremainingnetsalaryknownasthe‘homespendable’.

Appliedeffectively,costoflivingindicesenablecompaniestoadjustassignees’

salariestoensuretheirpurchasing

powerinthehomeandhostcountriesismaintained.ThisamountcanalsobereferredtoasthehomespendableplusCostofLivingAdjustment(COLA).TheCOLAcanbepositiveornegativeasthehomespendablemayneedtobeadjustedupordowntomaintainbuyingpowerinthehostlocationcurrency.

16ECAGlobalPerspectivesCostofLiving

2

4

Assigneename

AnneAssignee

Maritalstatus

Married

Organisation

ECA

Numberofchildren

2

Homecountry

Denmark

Hostcountry

Spain

Homelocation

Copenhagen

Hostlocation

Madrid

ExchangerateDKK1=EUR0.1345

DKK

EUR

Homebasepackage

Homegross

lesshomeincometax

lesshomesocialsecurity

plushomefamilyallowance

Homenet

Costoflivingdifferential

Homenet(afterdifferentials)

311124

1136

23184

510924

-90413

420511

153

3118

68719

-12161

800000

107600

56559

41846

3

2

1

LocalbasepackageEUR

Localgross

Localnetsurplus44887

lessincometax20400

lesssocialsecurity3154

plusfamilyallowance

0

Localnet61446

Localnet61446

85000

Net-to-netapproach

Inanet-to-netapproach,organisationschoosetopayassigneesthesamesalaryastheywouldpayalocalnationaltodothesamejobinthehostcountry.Inthissituation,anet-to-netsalarycalculationenablesthecompanytoassessthe

suitabilityofalocalsalaryinthehost

locationbycomparingthelocalnetsalaryagainstthehomecountrynet,takingthedifferenceinlivingcostsintoaccounttoo.Byhavingaclearpictureoftherelativebuyingpowerineachlocation,theycanvalidateand,ifnecessary,adjusttheirlocalsalaryofferfortheindividualconcerned.

Thecalculationaboveillustratesthestepsinvolvedinanet-to-netcomparisonforamovefromDenmarktoSpain.

IfweassumethatouremployeereceivesagrosssalaryinDenmarkofEUR107600andcomparethattotheamountpaidfortheequivalentpositioninSpain(EUR85000)wecanseethat,ingrossterms,theemployeeisearningEUR22600moreintheirhomecountryofDenmark.

1

However,innetterms,duetohighertaxesinDenmarkthisdifferenceisreducedtoEUR7273.

3Whenwefactorinacostoflivingadjustment,weseethatSpainischeaperthanDenmarkandthehomenetsalaryisreducedaccordingly.

Theendresult,afterfactoringinthetaxandcostoflivingdifferencesbetweenthetwocountries,isthattheemployeewouldinfactreceiveanadditionalEUR4887tospendifpaidthelocalSpanishsalaryforthisposition.

?EmploymentConditionsAbroadLtd17

Choosinganindextype

ECApublishesthreedifferentindextypes:standardhome-based,

cost-effectivehome-basedandcost-effectiveinternational.Theseindicesvaryaccordingtowhattypeofspendingpatternisreferenced–whatweightisallocatedtoitemsintheshoppingbasket–and

accordingtothepricelevelsthat

arecomparedbetweenhome

andhostlocations.

Spendingpatternscanreferencenational(home-country)orinternationaltrendsandcomparingdifferentpricelevelsinthehomeandhosttakesintoconsiderationhowcost-effectivelytheassigneemaybeexpectedtoshoponassignment.Indicesmaybehigherorlowerdependingontheassumptionsmade.

Differentindexchoicesmaybemoreappropriatedependingonfactorslikethelengthorlocationoftheassignmentandonthecharacteristicsoftheassignee.

Thegraphicoppositesummarisesthecharacteristicsofourthreeindextypesandprovidesexamplescenariosforwheneachmightbesuitable.

Althoughcost-effectivehome-basedindicesarethemostwidelyusedindextype,therearegoodreasonswhyothertypesmaybeconsidered.Formovesbetweenlocationswithsimilarshoppingenvironmentsitmaynotbenecessarytoprovideasmuchcompensationforadjustingtoanewenvironmentandthereforeacost-effectiveindextypemaybeappropriate.Asorganisationslooktocontrolcosts,usingcost-effectiveindextypescanalsoreducetheoverallassignmentcosttotheemployer.

Similarly,asglobalisationhasledtothewidedistributionofsimilargoodsandservicesaroundtheworld,indicesthatreferenceglobalspendingtrends,suchasourcost-effectiveinternationalindices,ratherthanthehabitsinaparticularhomenationmayalsobeanincreasinglysuitablechoice.

Somecompanieschoosetosetaninitialindextypeforthestartofanassignmentandthenswitchtheassigneesonto

anothertypelateron–forexampleswitchingfromastandardtoacost-effectiveindexoncetheyhavehadtimetoadjusttothenewenvironment.

Whenselectingwhichindextouseitisworthwhileconsideringnotonlywhichonewouldbemostapplicablefortheassignee,butalsowhetherunnecessarycostscanbeavoidedforthecompany.Thechoiceofindexcanhaveasubstantialimpactontheoverallassignmentcost,asthegraphicontherightshows.

Negativeindices

Whileanincreaseinsalarycanbeprovidedbyapositivecostoflivingindexwherethehostlocationismoreexpensive,anegativeindex(i.e.lessthan100)canhavethe

oppositeeffect.Applyinganegativeindextoasalarywillcauseittofallinnominalterms.However,thisispurelybecausethelowercostoflivinginthehostcountrymeanstheassigneedoesn’tneedasmuchmoneytomaintainthesamestandardoflivingwhileonassignment.

Theapplicationofnegativeindicesisacontentiousissue,withmorethanthreequartersofcompanieschoosingnottoapplythem.

Prosofnotapplying

?Assigneedoesn’tseepartoftheirsalarybeingtakenaway

?Improvesmorale

?Canactasanincentive

Consofnotapplying

?Caninhibitrepatriationoronwardmobility

?Assigneereceivesnoincreasewhenpricesgoupbutindexremainsnegative

?Providesunnecessarywindfall

Customisingthebasket

ECA’sindicescomparespendingonover170basicgoodsandservicesrepresentedbygroupsofexpenditureasseenontheright.

Whiletheseindicescoverabasicrange

ofeverydaygoodsandservicesthatare

appropriateformostassignments,there

arecircumstanceswherecompaniesmay

addorexcludesomeareasofexpenditure

fromtheindexcalculations.Thismay

bebecausethecompanycoverssome

coststhroughseparateallowancesor

deemssometypesofexpendituretobe

unnecessaryforthespecificassignment.

Forexample,anassigneemaybeprovidedwithacaranddriverbytheiremployerandthusthemotoringgroupmaybeexcluded.Exclusionscanalsobearesultofthe

shoppingenvironment.Forinstance,iftheclothingavailableinthehostlocationisnotofasuitablestandardforexpatriates,thentheclothinggroupmaybeexcluded.

ECA’sindicescanbetailoredtocompany

policybyincludingorexcludingspecific

groupsofexpenditureassummarisedon

theright.

18ECAGlobalPerspectivesCostofLiving

ECA’scostoflivingindices

Standard

home-basedindex

Cost-effective

home-basedindex

Cost-effective

internationalindex

International

Ascost-effective

Assigneesare

internationallymobileanddonothaveastronglinkto

theirhomecountry

?Multiple/consecutiveassignments

?Companiesoperatinginaspecificregion

E.g.EUwithhighlymobileworkforce

Homecountry

Ascost-effective

Assigneesareaccustomedtoworkingabroadorareinalocationsimilarto

theirhome

?Longassignments

?Assigneeshavetimetoadjustandshopascost-effectivelyasathome

?Intra-re