Q.4 2022

Data Points

A Selection of AIRINC Research Results

This quarter’s cost of living research was conducted primarily in Europe, Asia, and mainland Southeast Asia.

Housing Update

Snapshots of expatriate-quality rental markets around the world

War in Ukraine

Utilities in Europe

Tbilisi, Georgia

Germany

Kazakhstan

Phnom Penh, Cambodia

Taipei, Taiwan

Bangkok, Thailand

War in Ukraine

Russia’s continued invasion of Ukraine is still having significant effects on rental markets in Europe and Central Asia as nationals and expats flee both Ukraine and Russia. Predictions are bleak for the coming winter as living conditions worsen in Ukraine. Hundreds of thousands more in Ukraine are expected to leave the country, putting even more strain on already very limited housing markets in the region. Russians are leaving too if and when they can, adding to the numbers, although countries they can enter and stay in are still limited.

Utilities in Europe

Utility costs continue to dominate the headlines in western Europe. The ongoing war and associated economic factors have further disrupted major energy flows and transactions especially from Russia to parts of Europe and beyond. Since Q1 2022, utility costs have risen significantly and, while government action has mitigated these increases in some places, most consumers are facing higher bills for electricity and natural gas.

Tbilisi, Georgia

One of the rental markets most impacted by the conflict in Ukraine is Tbilisi. Sources noted that availability is so low that it is bordering on non-existent. Approximately 200,000 Russians have entered Georgia, as well as thousands of Ukrainians and Belarussians. Expatriates need to be flexible in their home search, regardless of budget.

Germany

In some rental markets, it is common practice for certain utility costs to be included in rent. In Germany, nebenkosten may include maintenance for shared areas, elevators, water, and heating. Due to the rising cost of utilities, the increased nebenkosten resulted in higher rents for apartments this update. In addition, a lack of supply versus demand in major cities like Frankfurt, Hamburg, Mainz, and Munich also contributed to rent increases.

Kazakhstan

Another location with relatively easier access to Russians, Kazakhstan has become a destination for those avoiding the military mobilization in Russia. This increased demand has raised rents across the country. In other news, after several years as Nur-Sultan, the name of the Kazakh capital is Astana again.

Phnom Penh, Cambodia

Vacancy rates are low for an already limited supply of expatriate-quality housing, especially for larger apartments and houses in central areas. Increased demand has driven rents up and, though new construction is in the works, those projects may not be ready to rent for several more years.

Taipei, Taiwan

Expatriates have been returning to Taiwan in increasing numbers after the government reopened the border in October. This higher demand is coupled with a reduced supply due to more landlords selling off properties. Larger budgets are now needed to secure good-quality properties.

Bangkok, Thailand

During the early years of the pandemic and restrictions, tenants had more power to negotiate with landlords. Now, things have returned to a more normal status and with more expatriates coming in, rents are rising.

Goods and Services Inflation

Selected locations with inflation higher than 5% for 6 months
Azerbaijan
Bangladesh
Belarus
Croatia
Czechia
Estonia
Greece
Hungary
Kazakhstan
Kyrgyzstan
Laos
Latvia
Lithuania
Mongolia
Myanmar
Nepal
Pakistan
Poland
Serbia
Sri Lanka
Sweden
Turkey
Turkmenistan
Ukraine
Uzbekistan

Selected 3-month Exchange Rate fluctuations of more than 5%

Laos

Currency: LAK

Change vs EUR: -13.5%

Change vs USD: -8.7%

Mongolia

Currency: MNT

Change vs EUR: -10.8%

Change vs USD: -5.9%

Russia

Currency: RUB

Change vs EUR: -9.3%

Change vs USD: -4.3%

Kyrgyzstan

Currency: KGS

Change vs EUR: -9.0%

Change vs USD: -4.0%

Nepal

Currency: NPR

Change vs EUR: -8.3%

Change vs USD: -3.3%

India

Currency: INR

Change vs EUR: -8.2%

Change vs USD: -3.2%

Bangladesh

Currency: BDT

Change vs EUR: -7.8%

Change vs USD: -2.8%

Uzbekistan

Currency: UZS

Change vs EUR: -7.8%

Change vs USD: -2.8%

Turkey

Currency: TRY

Change vs EUR: -7.0%

Change vs USD: -1.9%

Iceland

Currency: ISK

Change vs EUR: -6.6%

Change vs USD: -1.5%

Vietnam

Currency: VND

Change vs EUR: -6.3%

Change vs USD: -1.3%

Sri Lanka

Currency: LKR

Change vs EUR: -6.3%

Change vs USD: -1.1%

China

Currency: CNY

Change vs EUR: -5.7%

Change vs USD: -0.6%

Ukraine

Currency: UAH

Change vs EUR: -5.7%

Change vs USD: -0.5%

Israel

Currency: ILS

Change vs EUR: -5.5%

Change vs USD: -0.3%

Azerbaijan

Currency: AZN

Change vs EUR: -5.3%

Change vs USD: -0.1%

Belarus

Currency: BYN

Change vs EUR: -5.3%

Change vs USD: 0%

Cambodia

Currency: USD

Change vs EUR: -5.2%

Change vs USD: 0%

Hong Kong

Currency: HKD

Change vs EUR: -5.2%

Change vs USD: 0%

Romania

Currency: RON

Change vs EUR: -0.4%

Change vs USD: 5.2%

Thailand

Currency: THB

Change vs EUR: -0.3%

Change vs USD: 5.2%

Serbia

Currency: RSD

Change vs EUR: -0.1%

Change vs USD: 5.4%

Belgium

Currency: EUR

Change vs EUR: 0%

Change vs USD: 5.5%

South Korea

Currency: KRW

Change vs EUR: 0.4%

Change vs USD: 5.9%

Georgia

Currency: GEL

Change vs EUR: 0.4%

Change vs USD: 6%

Poland

Currency: PLN

Change vs EUR: 0.6%

Change vs USD: 6.1%

United Kingdom

Currency: GBP

Change vs EUR: 0.8%

Change vs USD: 6.4%

Czechia

Currency: CZK

Change vs EUR: 0.8%

Change vs USD: 6.5%

Albania

Currency: ALL

Change vs EUR: 1.1%

Change vs USD: 6.7%

Country
Tax Update

Changes in expatriate tax

Myanmar

Qatar

South Sudan

United Kingdom

Myanmar

The Myanmar tax year changed to begin on April 1st (previously October 1st). For the 2022/2023 tax year, the tax brackets were widened. The top marginal tax rate remains at 25%, applicable to taxable incomes exceeding MMK 70,000,000. Personal allowances are unchanged. Social security contribution rates are unchanged. The net effect of these changes is a decrease in tax for all taxpayers.

Qatar

Employment income continues to be exempt from income tax in Qatar. Major changes to the social insurance law were implemented in 2022. The law expands coverage to Qatari national employees and employees from GCC countries working in the private sector, adjusts covered earnings, and will phase in planned increases in the contribution rates. For 2022, the employee contribution rate is 5% and the employer contribution rate is 10% on gross wages. Expatriate employees that are not Qatari or GCC nationals continue to be exempt. The net effect of this change is an increase in social security for affected employees.

South Sudan

The social security rate decreased from 8% to 5%. The net effect is a decrease in social security, and a small increase in income tax, as social security contributions are deductible.

United Kingdom

UPDATE as of November 6, 2022: The contribution rates for National Insurance Contributions (social security) in both Scotland and the United Kingdom decreased by 1.25% for both employees and employers. The reduction was announced as part of the UK government’s Growth Plan and reverses increases implemented in April. The net effect of this mid-year change is a small decrease in social security for all taxpayers. Income tax for the 2022/2023 tax year is unchanged.

Research Location Update

Q.4 2022 Researched Locations and Upcoming Q.1 2023 Locations

AIRINC researches more than 150 locations each quarter.

Q.4 2022 Researched Locations
Q.1 2023 Upcoming Locations

White Papers & Articles

Mobility Optimization Paper

In this period of transition and reinvention, many companies are reorganizing their Mobility functions to address changes to their business or talent environments. We recently interviewed six Mobility leaders to learn how they are optimizing their Mobility functions. Everyone agreed that an optimized Mobility function is one that adds value to the organization by offering customers the right balance of skillsets and resources.

White Papers & Articles

Developmental Assignments & the Importance of Knowing Your Audience

Many mechanics of a developmental assignment are like that of a traditional expat assignment. Tax equalization, immigration support, and a COLA are commonly provided for both move types. However, developmental assignments target a specific type of employee: emerging talent, typically below age 35, that shows growth potential to the business.

Benchmark Surveys

2022 Mobility Outlook Survey

Global Mobility has emerged from the pandemic as a remarkably different function. After a second year managing travel restrictions, heightened immigration complexity, and remote work consequences, Mobility has honed its compliance skills and is shifting focus to address its next big challenge – helping attract and retain top talent.

White Papers & Articles

2022 Remote Work Playbook

In our first version of this playbook published in 2020, it was not clear if the rise of remote working would continue or only be a temporary pandemic phenomenon. It is now clear that remote work is here to stay.

For More Information

Please contact your Client Services representative for more details and further information.

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