The Venezuelan capital of Caracas has overtaken Tokyo to become the most expensive city in the world for international job assignments, according to a new ranking.
Topping the list for the first time, Caracas moved up from seventh in the previous year, driven by a 60 percent rise in the price of goods and services frequently used by expatriates, global human resource consulting firm ECA's Cost of Living survey showed.
Venezuela suffers from one of the highest inflation rates in the world due in part to the government's price controls, which act as a disincentive to local producers and has led to shortages of goods, as well as strict controls on foreign currency exchange. The government restricts access to dollars, which pushes up the price of imported goods.
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The survey compares a basket of like-for-like consumer goods and services commonly purchased by foreign assignees in 440 cities worldwide, including groceries, drink and tobacco, clothing and meals out.
The ranking excludes accommodation, school fees, utilities charges, and car purchases as they are typically compensated for separately in expatriate packages, ECA said.
Luanda, the capital of Angola - Africa's second largest oil producer – ranked in second place, with the cost of goods in the city elevated due to hefty import duties, high taxes and monopolized supply chains linked with the country's political elite.
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Oslo, Norway clocked in at third, Juba, South Sudan placed fourth and Stavanger, Norway came in fifth. Swiss cities Zurich, Geneva, Bern and Basel ranked sixth to ninth, respectively.
Tokyo, meanwhile, fell to 10th place, after topping last year's ranking. However, it is still the most expensive location in Asia for expatriates.
A weakening in the yen means that companies which need to locate staff into Japan can now do so for considerably less than in recent years. The yen has fallen around 24 percent against the U.S. dollar over the past 12 months.
Other major financial cities were scattered among the top 50 with Shanghai at 18, Hong Kong at 28, Singapore at 30, Sydney at 31 and New York's Manhattan at 33.
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Maseru, the capital of Lesotho in Southern Africa, meanwhile, is the cheapest location in the world for international assignees, largely driven by depreciation in the local currency – the loti – which has fallen 23 percent against the U.S. dollar this year.
—By CNBC's Ansuya Harjani; Follow her on Twitter @Ansuya_H