Phnom Penh Now Fourth Most Expensive City in ASEAN behind Bangkok and Phuket

KT - Sokunthea

Phnom Penh has been ranked the fourth most expensive city to live in Southeast Asia, according to the 2025 Numbeo Cost of Living Index, highlighting growing concerns over affordability in Cambodia’s fast-developing capital.

The index places Singapore at the top with a score of 79.1, followed by Phuket (38.1), Bangkok (37.1), and Phnom Penh close behind at 36.9. The ranking underscores the capital's rapidly rising prices, driven largely by surging housing costs, increased tourism, and steady foreign investment.

A one-bedroom flat in Phnom Penh’s city centre now averages $400 per month, while a basic meal costs around $3—steep for many Cambodians. The city’s grocery and restaurant indices are also high relative to local wages, painting a stark picture of urban affordability.

Experts say the root of the issue lies in Cambodia’s dependence on imports. “Most consumer goods come from abroad, and high taxes drive prices up,” said Seun Sam of the Royal Academy of Cambodia. He added that while prices in Phnom Penh may match those of Bangkok or Kuala Lumpur, income levels do not.

Low-income workers—especially those in the garment and construction sectors—are feeling the squeeze. Many live paycheque to paycheque, struggling to meet basic needs in a city that increasingly caters to wealthier residents and international visitors.

Economic analyst Tom Goh warned that rising living costs are a natural byproduct of development, but said the current growth is disproportionate. “The benefits of tourism and real estate booms don’t always reach low-income groups, deepening the urban poverty divide,” he noted.

While urbanisation has brought more stable incomes for city workers, rural-urban wage disparities persist. A labourer’s daily wage in the provinces, Seun pointed out, may not cover two cups of coffee in the capital.

The Cambodian Institute for Cooperation and Peace has called for urgent social protections, warning that the swelling ranks of Phnom Penh’s urban poor pose a long-term challenge for sustainable development.

As the city grows, balancing economic progress with equity will be key. For now, life in Phnom Penh is becoming pricier—and for many, harder to afford.

-2025-05-13