Living in the Marvelously Expensive City

Opinion, by Samantha Barthelemy

RIO DE JANEIRO, BRAZIL – Everyone is talking about the soaring costs of living in Rio de Janeiro – the 12^th most expensive city in the world for expats according to Mercer’s 2011 Worldwide Cost of Living Survey.

We are all feeling the pain.

I moved back to Rio in July – after years of living between New York and Paris, the 32^nd and 27^th most expensive cities in the world, respectively – and am shocked at the price of everything.

Commercial rent in my native city is the fourth most expensive in the world; rent in Leblon and Ipanema rose as much as 380 percent since 2006; Rio’s daily parking rate (at an average of R$30) is the highest in Latin America; and the list goes on.

Google “cost of living in Rio” and the first results start with “Rio de Janeiro is more expensive than…”

It’s offensive. Whatever I considered expensive in Paris or New York, is simply absurd here.

I decided to “go all out” one weekend. First stop Zuka, one of Leblon’s popular venues (my mistake) and paid R$130 for a shared appetizer and dessert, a hamburger and half of the “cheapest” bottle of red wine. Plus R$15 for valet parking.

Then Praia, the “happening” nightclub in Lagoa (second mistake) where my guy friends were told they could “choose” between R$100 entrance fee or R$200 in consumption. We chose to go somewhere else.

The next day I took my siblings to visit Rio’s Christ the Redeemer Statue: R$36 per person to go up in the trains or R$25 per person for five minutes in a shared van – the only two ways of accessing this New Wonder of the World.

Granted we are talking about “options” of the privileged.

Reports like Mercer’s are designed to help multinationals and governments determine compensation allowances for their expatriate employees (who usually get paid well and in US dollars) – measuring the comparative costs of items including housing, transport, food, clothing, household goods and entertainment in cities around the world.

If in absolute terms (and in dollars) living in Rio has become outrageous, in relative terms (and in reais) the situation is unsustainable.

For most lower income Cariocas, who earn no more than R$600 a month dreams of recreation, culture and meals out are not even an option. People are living on survival mode.

Following The Economist’s Big Mac Index – a guide to whether currencies are at their “right level” – at market exchange rates our Mc sandwich is among the most expensive in the world (US$6.16), losing only to Switzerland’s and Sweden’s. When adjusting for GDP per capita, the real comes out as the most overvalued currency in the world.

Last year Rio’s municipal government introduced the Cartão Família Carioca (Carioca Family Card). The “logic” is, while in Brazil levels of inequality are slowly diminishing, in Rio the opposite is taking place. The federal cash transfer program, Bolsa Família, is no longer enough.

Rio has become the land of extremes. This cannot last. And not simply because exorbitant prices are not equivalent to product and service quality.

In the meantime, as my colleague Stone Korshak wrote, life in the Marvelous City continues to be one of work and constant struggle  for everyone to cover the bills, bills that are increasing quickly.

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A Belgian-Brazilian native of Rio de Janeiro and former United Nations journalist, Samantha Barthelemy is a dual degree Masters of International Affairs with Columbia University and the Paris Institute of Political Studies living in Rio and working with education and public security policies.  http://samanthabarthelemy.blogspot.com