A recent report published in Yahoo list Luanda Angola as the second most expensive place for Expatriates to live in the world and the first in Africa. This is surely not a ranking any third world country, especially in an Emerging Market seeking to attract major investment. Being an expensive city means it cost more to operate a business in the country and surely when you are in a business that requires expatriate staffs. To make matters worse Angola was the only African country on the list, can you believe that?? Even Nigeria wasn’t named. Now how can that be? Is this a case of “the more you look”? Let’s dissect
The report mentions comparatives which we will dissect and see if it holds water. We shall use N160 as an equivalent exchange rate to the US Dollar.
1. Rent: The report puts the average rent for luxury flats in Luanda at $6,500 monthly or $78,000 per annum.
Nigeria: According to Real Estate Agents and real estate website Castle Luxury Flats in Lagos cost between $60,000 to $100,000 per annum. That puts the median at $80,000 or $6,666.66. And that excludes service charge which typically cost from about $15,000 per annum. Just to add, luxury apartments in Lagos are piad at least one-year in advance and in most cases two years in the first instance. Lagos for sure is more expensive.
2. Cup of Coffee – The report puts an average price of cup of coffee in Luanda at $3.90 (N624).
Nigeria : A cup of coffee in a luxury hotel in Lagos average about N600. In fast food joints its around N350 per cup.
3. One Gallon of Gasoline – $2.38 A Gallon in litres is an equivalent of 3.875litres. So a litre is therefore it cost around N380 to buy 3.875litres of petrol in Luanda
Nigeria : In Nigeria a litre of petrol is N97 thus 3.875litres cost about N375.8. Very close as such I give this to Angola.
4. Daily International Newspapers – The report puts the cost of International Newspapers at $5.46 (N874)
Nigeria – Foreign Newspapers average N500 to N800 in Supermarkets and Magazine Shops. Yet again this is lower than the average cost if Luanda.
5. Fast Food Meal – In Luanda Fast Food meal averages $19.94 (N3,190)
Nigeria– Fast Food Meals in Nigeria cost an average of N1500 (including a bottle of mineral). Yet again it cost more in Luanda.
Finally, it is obvious the argument does hold water. Remarkably Nigeria’s isn’t amongst the top 20 in the world as N’djamena, Chad (8), Libreville, Gabon (20), Khartoum, Sudan (26) all rank next. If you are wondering why there so many African cities in the ranking. The reason as the report explains is due to “difficulty finding good, secure accommodation for expatriates. So the limited supply of acceptable accommodation is very expensive. The cost of imported international goods is also high, contributing to many regional cities moving up the ranking,”. Its no wonder Nigeria is excluded from the top 20, foreigners get goods and services easily in Nigeria whilst luxury real estate in Nigeria is currently facing a clog as vacancy rates of apartments near double digits figures. One might consider a good development as the cost of hiring expatriates are now reducing making the country all the more attractive for foreign investments. Johannesburg by the way is ranked 154. Unfortunately there was no mention of Nigeria in the article meaning one would have to purchase the full report to see where Nigeria lies.