Capital of Zimbabwe on priciest cities list

By Linda Sandler
Bloomberg News

LONDON — Tokyo, New York and London, among the top 10 most expensive cities, are rivaled by an African city that last year was a cheap place to live, according to a survey by the Economist Intelligence Unit.

Harare, Zimbabwe's capital, placed fourth in the rankings, behind Tokyo, Osaka and Hong Kong and above Oslo, New York, Zurich and London. Harare was 120th a year ago.

In financial centers, costs are pushed up by investment bankers who buy million-dollar homes and eat $200 lunches in restaurants.

Harare's costs rocketed because of inflation, shortages of goods on the shelves and an overvalued currency, the Economist said.

"If a currency strengthens or inflation pushes up the price of goods, so the relative cost of living in that country will rise," it said in its annual survey.

London, in eighth, remains the most expensive city in the European Union, although exchange rate changes pushed it down two notches from last year.

In Europe overall, Oslo has the highest prices and Bucharest the lowest.

New York, which has North America's highest cost of living, remained seventh even after the economic weakness following the World Trade Center attack.

Osaka, host to World Cup games, and Tokyo, remains at the top of the world list.