Naira Depreciation Ranks Lagos, Abuja Among Cheapest Cities for Expats

By Milcah Tanimu

Lagos and Abuja, Nigeria’s commercial hub and capital, have been ranked among the world’s cheapest cities for expatriates, according to the 2024 Mercer cost of living survey.

Naija News reports that this affordability is due to the significant depreciation of the naira, which began after President Bola Tinubu implemented economic reforms removing the currency peg set by former Central Bank Governor Godwin Emefiele.

Mercer’s survey highlights that Lagos and Abuja experienced the largest decreases in living costs among 226 global cities from 2023 to 2024, despite Nigeria’s high inflation rate of 33.95%, with food inflation exceeding 40%.

In 2023, Lagos was the 47th most expensive city, while Abuja was ranked 140th. By 2024, Lagos had dropped 173 spots to 225th, and Abuja followed closely behind at 226th. Similarly, Islamabad, Pakistan, was ranked low.

The survey notes that currency devaluations have significantly contributed to these cost-of-living decreases, even though inflation rates have surged in countries like Nigeria and Angola, where inflation exceeded 20% from March 2023 to March 2024.

In contrast, half of the top 10 most expensive cities for expatriates are in Western Europe, with Switzerland hosting four. Southeast Asian cities lead the list, with Hong Kong and Singapore occupying the first and second spots.

In Africa, Lagos and Abuja rank as the cheapest, with Bangui, the capital of the Central African Republic, rising 12 places to 14th globally. Djibouti and N’Djamena follow at 18th and 21st, respectively. Conversely, Blantyre, Lagos, and Abuja are among the least expensive African cities, positioned at 221st, 225th, and 226th globally.

Other notable rankings include:

• Johannesburg, South Africa: Global rank 206. Known for economic opportunities and affordable living costs, Johannesburg dropped slightly from 205 in 2023.
• Cape Town, South Africa: Global rank 209. Despite being a tourist hotspot, Cape Town offers reasonable costs for expats.
• Tunis, Tunisia: Global rank 210. Combining cultural richness with affordability, Tunis advanced nine places.
• Lusaka, Zambia: Global rank 213. Renowned for low living costs, Lusaka dropped 16 places.
• Gaborone, Botswana: Global rank 215. Offering affordable housing and essentials, Gaborone improved its rank by one place.
• Windhoek, Namibia: Global rank 218. Attractive to cost-conscious expats, Windhoek climbed four places.
• Durban, South Africa: Global rank 219. Known for lower living costs compared to Johannesburg and Cape Town, Durban improved from 220 in 2023.
• Blantyre, Malawi: Global rank 221. Notable for low costs in housing and daily expenses, Blantyre dropped 23 places.

Lagos and Abuja’s significant ranking drops highlight the impact of currency depreciation on living costs for expatriates, positioning them as some of the most affordable cities globally despite economic challenges.