In a recent study conducted by ECA International on the cost of living for expatriates across Asia, Singapore moved down three places to 12th place. In addition to four Japanese, cities, several Chinese cities including Beijing, Shanghai, Shenzhen, and Guangzhou were found to be more expensive than Singapore. Korea’s capital, Seoul, is also one spot ahead of Singapore on the list.

Multinational firms choose their locations in Asia for a variety of reasons, including labor stability, ease of dealing with government officials, and operation costs. The cost of living for expats is also often taken into consideration, as it is easier to persuade employees to move overseas to a relatively affordable location. For example, while similar to Hong Kong in many ways, Singapore is estimated to be about 15% less expensive for expat residents. Tokyo is a staggering 68% more expensive than Singapore.

In addition to its relatively low cost of living, Singapore is also considered one of the easiest cities in Asia to localize foreign talent. The Singaporean government has rolled out several initiatives including competitive income tax rates and a Personal Employment Pass system that allows foreigners to easily change jobs. For this reason, many Westerners and overseas Chinese are willing to work in Singapore as local hires or on “local-plus” packages. These packages often exclude costly expatriate benefits such as housing and education allowances, but still include some less expensive perquisites like transportation allowances or home leave. In a recent survey conducted by PricewaterhouseCoopers, nearly 60% of multinational firms interviewed stated that they have their regional headquarters in Singapore.