Korea Ranks Medium-Low Price Level Group in OECD
By Na Jeong-ju
Staff Reporter
Many foreigners feel Seoul has become more expensive in which to stay, but this is mainly because of the won's appreciation against the dollar, not because of higher consumer prices, the Bank of Korea (BOK) said Tuesday.
Citing 2004 data from the Organization for Economic Cooperation and Development (OECD) on comparative global price levels, the central bank said the country is included in a ``medium-low price level group'' along with Canada, Italy, Australia and New Zealand.
The OECD divided 42 countries around the world into four groups_ high, medium-high, medium-low and low _ after analyzing consumers' purchasing power, price fluctuations and currency rates.
The United States, Japan, Switzerland, Norway, Denmark and Iceland were included in a high-price level group. In a medium-high price level group were Germany, France, the United Kingdom, Sweden and six other countries.
Russia, Turkey, Hungary, Poland and nine other nations were in a low-price level group, according to the OECD.
``Most recent data shows, among 30 OECD member nations, South Korea ranked 23rd in terms of comparative price level,'' the BOK said.
Private research groups have released data showing Seoul has become one of the most expensive cities in the world for business and tourism.
A recent survey by the Business Travel News said an average American businessman would spend $396 a night in Seoul. Seoul is the eighth most expensive city to stay in among 100 cities around the world, followed by Moscow, London, Paris and four other cities. Tokyo came 25th.
Mercer, a global business consultancy, also said Seoul is the second most expensive city in the world, only after Moscow, for its employees to stay, citing a consumer price survey among its employees around the world in March.
Tokyo ranked 3rd; Hong Kong 4th; London 5th; New York 10th; and Paris 15th, Mercer said.
``The price gap between the OECD survey and polls by private firms reflect the Korean currency's fast appreciation since 2002, while other currencies have remained relatively stable against the dollar,'' the BOK said.
From 2002 to 2006, the won rose 42.5 percent against the U.S. dollar, while Japan's yen and the Hong Kong dollar gained 10.1 percent and 0.3 percent, respectively, the bank said.