The Sunday Leader

Colombo, Seventh Least Expensive City In The World?

Wednesday morning we nearly fell off our hansiputuwa. The government owned Daily Noise’s headline screamed: Welcome to Colombo, and had as the lead story that Colombo was the seventh ranked ‘least expensive city in the world’ by the prestigious Economic Intelligence Unit. The other two ‘independent’ dailies too had the story on the front page but displayed it less prominently.
We waited for the next day for the usual hoopla, ‘We told you so, etc.’ and bashing of the cynics, Doubting Thomas’, NGO traitors, etc. but only the armchair critics, tourism pundits who had said that Colombo’s pricing of hotel rooms was too expensive could lead to a crash of the tourist industry came in for a verbal bashing.

Not only for foreigners

The reason for the song and dance over EIU survey was revealed the next day in the government media. It said: ‘The other important dimension that cannot be ignored is the ‘general cost of living’ factor. If Colombo is good for tourists, it cannot be bad for local daily wage earners, could it?
‘The cynics would always argue that that this is not a reasonable conclusion that follows as Colombo’s daily wage earners are on Sri Lankan salaries that they would argue have not increased for a long time.
‘Yet if the dollar spending tourists have it easy here there would definitely be some corresponding co-relation and Colombo is therefore by this count, a relatively inexpensive city for everyone tourist and Sri Lankan alike, considering that no modern city is easy on the purse for regular commuters or permanent residents.’
We have quoted the editorial at length for we are unable to fathom the contorted logic of the state media and for readers of The Sunday Leader to follow the logicality or illogicality of the argument.
Here we were, trying hard ‘burning the candle at both ends’ to ‘make both ends meet’ as a journalist colleague used to say about our shrinking purses and the prestigious Economic Intelligence Unit (EIU) proclaims that Colombo is the seventh cheapest city in the World! May be in esoteric economic terms that we may not be able to comprehend this phenomenon but Sri Lanka’s economy has been following the converse of Newton’s Laws of Gravity: Everything that goes up does not come down but goes up higher and higher. Take the price of a pang gediya which has been going up and up from the days of Chandrika Kumaratunge who vowed to bring the price down when it was Rs. 3.50 and now it is over Rs. 60 and still rising. We may not be understanding the Economics of The Economist and the state media.

What the economist investigators said

We went to Google to find out what exactly the EIU had said and found that many South Asian cities including those in India (with a booming economy of around 8 per cent for over a decade) and Karachi in Pakistan ranked even cheaper than Colombo! The list included 157 cities with Tokyo, Osaka, Sydney, Oslo on top while Colombo was placed 125th. Below us came New Delhi (129th)Mumbai and Karachi (Both in lying neck to neck at the 130th position).
Indian readers are not believing the rankings given to their cities. Pritish Nandy, the well known Indian poet, painter, journalist, and media and TV personality had commented in a Blog: ‘Mumbai, cheapest city? Now that’s a joke if I ever heard one’. Another comment from a blogger was: ‘Where was the survey ever conducted?’
The misunderstanding of the EIU survey appears to be stemming reports sent in by agencies and published in newspapers not giving the basis of the survey.
The Indian blog First Post gives the basis on which the survey was conducted.
It says ‘The Index measures the cost of expatriate lifestyles in over 131 cities using weighted average prices of 160 products and services.’
It explains: The worldwide Cost of living Index survey enables human resource line managers and expatriate executives to compare the cost of living in 140 cities in 93 countries and calculate fair compensation policies for relocating employees.
So as much as the state media analysts try to project that the index of the EIU also reflects the cost of living of ordinary citizens of South Asia, it isn’t so.
Colombo may be the seventh cheapest city in the world for gallivanting foreign executives but it is not so for the Colombians (as some Hultsdorp Black coats describe us inhabitants) who earn Third World salaries of $10 to $ 15 per day and have to spend much more!
We confess that we are not economists of the calibre of those from The Economist or the Sri Lankan state media. So can genuine economists (not from the Central Bank) please help?

A World Class

For the benefit of researchers EIU as well as those in the Sri Lankan state media we suggest the study of lifestyles of a certain category Sri Lankans. We reproduce some basic facts in brief.
Official income between $(US) 600 to 800 per month . Unofficial income $620,000 or more (tax free). Free lodging in the best areas of Colombo in palatial bungalows. Contingent of body guards armed to the hilt provided with vehicles. Frequent foreign jaunts with First Class travel for wife (and family) if required. Free lodging expenses paid in hotels – five stars and above. Free luxury vehicles – Mercedes, BMW, Volvos and now Rolls Royce (for a selected few). Free fuel, telephone facilities including IDD. Free education for children in the best of Colombo schools. May send them abroad at private expense. No objection to sponsorship by well wishers. Can hob-nob with world leaders. Any more perks if requested will be provided.
Can the life styles of those living in the best cities of the world like Tokyo, Osaka, Sydney, Oslo, New York, London and Paris match this category? Publication of the lifestyles of these ladies and gentlemen will lead to an influx of Direct Foreign Investment.

1 Comment for “Colombo, Seventh Least Expensive City In The World?”

  1. Living the dream in the west

    SL is cheap because the economy is rubbish. With dirty streets, pot holes and beggars, no wonder tourists are staying away from SL.

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