IN a recently released list of the most expensive Asia-Pacific cities for business travelers, Hong Kong climbed up six spots to emerge as the costliest of them all.
This doesn’t come as a surprise for a city like Hong Kong, which also came up top in a list of the world’s most expensive cities for expats some three months ago.
One of the main reasons Hong Kong is supremely expensive for a traveler is soaring hotel room rates due to steep property prices and a relatively low supply of business class hotel rooms.
According to South China Morning Post, more competitive rates around the region could eventually result in corporate travelers moving away from Hong Kong, and ultimately compromising its ambitions to become a convention and trade fair hub.
Regional director of ECA Lee Quane said that high real estate costs are a “fact of life” in Hong Kong, and unlike Macau, the city was unlikely to become a trade hub.
A four-star hotel in Hong Kong goes for US$300 a night, which is the second-highest hotel rate in the region after Dhaka. Plus, a low supply of hotel rooms catered to business travelers have resulted in leisure hotels driving up average prices.
Quane added that a strong Hong Kong dollar, pegged to the greenback, made the expensive city even less competitive than before.
However, the chairman of the Hong Kong Hotels Association, Victor Chan Kok-wai, seems to disagree by saying that ECA was off the mark with their figures.
Chan said, “It’s ridiculous to say the average cost is US$300 a night. Our average is US$200.”
Chan added that in Hong Kong, there was a gray area between business hotels and tourist hotels: “Hotels in Wan Chai, Admiralty and Tsim Sha Tsui serve a lot of business travelers.”
Excluding hotel costs, Hong Kong’s position in the list drops to eight. Not including hotels, Seoul. Tokyo, Sydney, Singapore and Shanghai are the most expensive for business travelers.
CFO Innovation pointed out that because hotel costs are regularly paid directly by the company, employees are often not aware of these costs and will focus on costs associated with meals, transport, laundry, and other miscellaneous costs.
Quane said, “More often than not, [travelers] will be reimbursed for these costs or will receive an allowance from the company to meet such expenditures.”
Relatively cheap public transport costs and costs associated with incidental expenditure contribute to a lower ranking once hotel costs are stripped out.”
On the other end of the spectrum, Kuala Lumpur is the cheapest city in Asia for business travelers, followed by Bangkok, Phnon Penh and Bandar.
Quane commented, “A combination of generally low living costs, relatively cheap accommodation options for business travellers and weak currency against the USD have contributed to these locations being where they are in our rankings.”
Here’s the full list of Asia-Pacific’s most expensive cities for business travelers:
- Hong Kong
- Dhaka, Bangladesh
- Seoul, Republic of Korea
- Tokyo, Japan
- Busan, Republic of Korea
- Sydney, Australia
- Shanghai, China
- Perth, Australia
On another note, Hong Kong is also recorded as the most expensive city in the world for expats owing to costly housing and extremely high rental costs.
The monthly rental for an unfurnished two-bedroom apartment in the city can scale up to US$6,800, ahead of New York at US$5,100 and London at US$4,580.