Quality of Life 2007

Learn more about living overseas in IL Postcards.

At the other end of the Index, again for year number two, Iraq scores the fewest points and ranks as the world's worst place to be.

The European countries always get top scores (with the Netherlands, Switzerland, Denmark, and Luxembourg making it into our top 10 this year), as do the antipodean nations of Australia (second place) and New Zealand (fourth). Argentina, for the first time, makes it into our top 10 (in 10th position).

Before I go further, I should explain, especially for new readers (welcome!), what we're doing here. Eleven months of the year, we consider the countries around the world where you could live cheaper, pay less tax, enjoy better weather, take advantage of opportunities in emerging markets…places where you could start a new life, start a business, start over…

Then, once a year, every January, we take a different perspective. We consider not only those places that offer particular and timely opportunities for the would-be expatriate…but nearly every nation on earth. This year, our survey looks at 193 countries.

To produce this annual Index we consider, for each of these countries, nine categories: Cost of Living, Culture and Leisure, Economy, Environment, Freedom, Health, Infrastructure, Safety and Risk, and Climate. This involves a lot of number crunching from "official" sources, including government websites, the World Health Organization, and The Economist, to name but a few.

But that's not all. Once the official data is collected, we also take into account what our local correspondents from all over the world have to say about our findings. They are, after all, working and living in these countries themselves. They point out where the institutional stats are all wet.

The results are distilled into a mammoth survey. The highlights are included here in your issue. You can find the comprehensive data here. Also, if you are not yet a subscriber to the free IL Postcards, you can become a subscriber to the free IL Postcards and access the complete data.

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The trickiest thing will be deciding which region of France has the qualities you seek. The wild, rocky shores of Celtic Brittany, steeped in old customs and traditions? Or sun-drenched Provence with its hill towns and lavender fields, fringed by a turquoise sea and the shady palm trees of the Côte d'Azur?

Then there's the Dordogne département in Aquitaine, a lush land of castles and quaint villages stuck still in the Middle Ages. If you're mad for markets, you'll be in paradise here. The Dordogne has dozens, and it's renowned for its gastronomic specialties, such as foie gras, truffles, and other wild mushrooms.

All sizable towns have bus networks with good coverage. Many cities also have underground train services, known as the Métro. Paris has one, of course, but so too do Lille, Lyon, Marseille, Toulouse, and Rennes.

The world's fourth-largest exporter, France has a per-capita GDP of $27,500, and inflation stands at just 2%. With last year's growth rate coming in at 1.1%, and this year's forecast to be 2.6%, the French economy has lots of things going for it-including ultra-modern transport and communications systems, competitive energy costs, and a AAA credit rating.

But, yes, it also has a 35-hour work week, 9% unemployment (in comparison, Ireland, with one of the strongest economies in the world right now, has a 4.5% unemployment rate), and all kinds of generous provisions for the workforce that would result in much wailing and gnashing of teeth in the lean, mean, business world of North America. Approximately one in four employees work in France's cumbersome public sector.

Yet, despite France's long tradition of state involvement in the economy, successive recent governments, both left and right, have been striving to create the kind of pro-business environment sought by international investors. The former socialist prime minister, Lionel Jospin, privatized or partially privatized more companies than his four predecessors combined. Air France, France Telecom, and Thomson Multimedia are the flagships, but other telecommunications, defense, aviation, and banking companies have also moved in recent years from state to private sector.

For most overseas onlookers, France's marketplace image conjures up visions of perfumes, cosmetics, fashion, top-quality wines, and gourmet foods. All are valuable exports, but so too are Exocet missiles, Mirage jets, and Renault, Peugeot, and Citröen cars.

Although e-business is growing significantly, the country's traditional muscle lies in engineering and transportation-few would disagree with the fact that TGV trains rank among the world's best, for example. Some engineering talent has recently been lured into the glitzy world of web ventures, but the metal-bashing industries still attract top graduates; likewise the nuclear, defense, chemical, telecommunications, and pharmaceutical sectors.

With sales totaling $23.5 billion, France represents 24% of the European pharmaceutical market and is the continent's number-one producer of drugs. More than 150 North American biotech and pharmaceutical companies now operate in France, including Amgen, Abbott Labs, Baxter, Genzyme, and Quintiles.

As you would expect, French development agencies are tremendously upbeat about the advantages of choosing the country as a European base. DATAR-IFA, the main government agency, cites seven reasons why foreign companies should consider investing in their country (quoted from their literature):

1. It's a large market in the heart of Europe.
2. It's a country open to the world.
3. There's a strong pro-business environment.
4. Financial markets are attractive and competitive.
5. The workforce is productive.
6. The country is at the forefront of science and technology advances.
7. France is known for quality, reliability, and productivity.

You may not agree with all their reasons (we're not sure we do), especially if have one-on-one experience with the French workforce. Maybe it's a throwback to the old revolutionary spirit, but French workers seem to have more grievances than workers in the rest of Europe combined. The labor unions are (to put it politely) active.

Furthermore, France is the European Union's largest agricultural producer, and farmers here are a powerful political lobby group. Most of us have traveler's tales about being halted at the Channel ports by the blockades and barricades of those fuming sons of the soil.

The downsides of la vie Francaise
Superstar infrastructure, solid economy, and the world's best health care…plus a surprisingly affordable cost of living outside Paris, beautiful and diverse countryside, and one of the world's most alluring and romantic capital cities…That's the good news.

As I've mentioned already, the bad news in this country has a lot to do with its tax systems. The question of whether you pay U.S. or French taxes on your worldwide income comes down to which country you make your fiscal domicile-that is, where you are resident for tax purposes. If you live permanently in France, and your residence is considered to be your fiscal domicile, you must pay taxes to the French government on your worldwide income.

Remember, in addition, that living or earning income outside the U.S. does not relieve a U.S. citizen of the responsibility for filing tax returns. However, France has a tax treaty with the U.S. This ensures that you will not be taxed twice on the same income. U.S. citizens living and/or working abroad may be entitled to various deductions, exclusions, and credits.

For more information on working, living, or investing in France, contact International Living's Europe Office, e-mail: France@InternationalLiving.com.

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Australia's economy is strong (score of 89 points in this category). Australia is a member of Apec, the Asia Pacific Economic Cooperation forum, and aims to forge free-trade deals with China and the Association of Southeast Asian Nations (Asean).

Australia's neighbor Down Under, New Zealand, comes in fourth place this year in our Index, moving up one position from last year.

New Zealand is jaw-droppingly beautiful. Stretching across 1,000 miles, the North Island and South

Made famous as the location for The Lord of the Rings movies, its elemental landscapes are so pristine you might have trouble believing they're for real…even if you see them with your own eyes.

Geysers gush, and mud pools bubble. Whales spout, dolphins frolic, and surf booms onto sands where yours might be the only footprints. Iced with glaciers, towering mountains range above a landscape veined with rushing rivers.

But New Zealand offers more than surf, turf, and Middle Earth wonderland. Auckland, Wellington, and Christchurch are vibrant urban centers. And numerous small coastal and rural towns offer an enviable community spirit that's increasingly hard to find in today's world. Auckland is the fifth best city in the world to live, according to a 2006 Quality of Life survey by Mercer Consulting, with Wellington coming in 12th position.

The other-worldly landscapes are backed up by substance: affordable health care (New Zealand scores 90 points in this category in our Index), an English-speaking population, free education, a low crime rate, great infrastructure, and one of the world's highest "healthy longevity" figures.

On top of all that, New Zealand hides enticing real estate opportunities. You can still find homes-and we mean proper houses you can move into-for less than US$50,000. (Right now your U.S. dollar will buy you $1.46 Kiwi dollars.)

The downside to living in Australia and New Zealand is how increasingly difficult it is to obtain full-time residency. Both countries are looking for younger, professional expats. In New Zealand, for example, you must qualify through a point system-you get more points for certain qualifications than for others, and the younger you are, the better. For more information on the residency requirements, contact Malcolm Pacific, tel. (64)9309-4187.

All boast excellent health care and infrastructure, little poverty, strong economies, and high levels of freedom.

Biggest cities

Source: City Mayors statistics

Italy's landscapes are as memorable as they are diverse. Historic walled towns, timeless villages crowning little hilltops like tiaras, and fields covered with bright yellow sunflowers.

Gnarled olive groves and lemon, orange, and almond trees…golden beaches and jewel-like Alpine lakes…romantic, mysterious islands…smoldering Mount Etna…the glittering peaks of the snow-covered Alps and the Dolomites. Italy is said to hold more than half the world's cultural riches within its borders. We don't doubt it.

For the best winter weather, look to the Italian Riviera, the Amalfi coast, and the islands of Sicily and Sardinia. All enjoy a mild winter climate without heavy rainfall. Obviously, the farther south you go during the summertime, the hotter it gets…and the deep south can be warm indeed. In Apulia, the heel of Italy, the sea temperature averages 82? F in August.

Italy ranks among the World Health Organization's top 10 countries for quality health services (by contrast, the U.S. holds 37th place, despite being the biggest spender). However, although medical facilities are considered adequate for emergencies, public hospitals are overcrowded and under-funded.

Of course, you don't have to use public health facilities. Like many Italians, you can avail of the parallel private medical service that caters for patients covered by private medical insurance. Note, though, that, in some small towns, particularly in the south, you will only be able to access the public health system-private doctors and hospitals congregate where the money is.

Current statistics put the number of doctors in Italy at 322,000, and life expectancy is relatively high: 76 years for men, 83 for women.

Obviously, how much it costs to live in Italy depends on your lifestyle and whereabouts you choose to settle. Housing costs aside, at current exchange rates, singles need an annual income of $20,000 to $26,000 to enjoy a middle-class lifestyle in northern and central Italy. Couples require an income of between $26,000 and $40,000.

It's impossible to give an average per-square-foot price for Italy, though most provincial properties fall into the $185 to $315 per-square-foot range. As a rule of thumb, you'll pay far less for apartments in provincial towns than in major population centers.

In Northern Italy, you still can find restored village houses in the idyllic wine-producing region of Piemonte, for example, for less than $70,000. Look to the hills of western Liguria-the stunning Italian Riviera-for ready-to-move-into village properties for less than $85,000. In the Lake Maggiore town of Stresa, a studio apartment in a restored "liberty" period villa could be yours for $78,000…or how about a habitable house with a couple of acres in a tranquil corner of central Italy's unspoiled Le Marché region for $64,000? Looking for a traditional farmhouse fixer-upper? In the verdant hills of Emilia Romagna, the starting figure is a mere $60,000.

As you can see, there are affordable options all over Italy. Yes, even in Tuscany, if you concentrate on the hilly north of the region instead of the golden triangle between Florence, Pisa, and Siena. Around Lucca and in the Lunigiana, habitable village houses still surface for less than $100,000.

As for the economy, although southern Italy has some economically disadvantaged regions, this is not an impoverished country-it is among the world's seven most industrialized nations.

On Feb. 25, 2005, Argentina completed the biggest debt restructuring in world history, as investors holding $103 billion in defaulted Argentine debt were asked to accept a government offer to pay back about a third of their original investments. After the deadline past, Argentine stocks immediately soared to a new all-time high in peso terms.

According to Money Week (www.moneyweek.com), Argentina's economy has grown at 8% a year over the last three. Property prices have risen by 50% over the same period, but still cost around a 10th of the price of similar homes in the U.S. or Europe.

Buenos Aires is among the world's "brand-name" cities, generously, though understandably, referred to as the Paris of South America. The architecture of BA is eclectic. Older classic-style buildings that would be well at home in any European city sit alongside unappealing highrises built in the '60s, '70s, and '80s, as well as, here and there newer and less offensive modern structures.

The older apartments in Buenos Aires are much bigger than their European counterparts, making them more comfortable than the typical Continental pied-a-terre. The typical apartment in Buenos Aires is approximately 3,000 square feet, with three bedrooms, two bathrooms, a large kitchen, sitting room, dining room, and maid's quarters. Compare this with Paris, where a 300-square-foot apartment isn't unheard of.

Furthermore, the per-square-foot cost of these apartments is a third to a 10th that of a similar property in Europe. A 1,000-square-foot apartment, for example, in one of these Argentine properties of character will cost you about $175,000 to $200,000 right now (that's about $175 per square foot). All indications are that an investment in an apartment in Buenos Aires remains a good one.

Argentina offers a greatlife…as it's supposed to be lived. We've tried to put our finger on why this is true, exactly. What is it about Argentina that keeps drawing us back? That attracts hundreds of thousands of travelers every year?

Is it the wonderful food and the long dinners that last for three hours at a stretch? The best beef in the world…fabulous wines and entertainment that goes on into the early hours of the morning? Or is it that, every time we return, we find new sights to see and new places to explore?

It's all of these things, of course. But, right now, it's primarily that it's so cheap (it's the 11th cheapest country in the world, according to our Index). It's hard to go wrong there…whether you are thinking about relocating…or just investing. Now is the time to act.

Still, the truth is, the U.S. is one big, convenient, comfortable, safe, even cheap place to be. You can live easily, affordably. You can do anything, go anywhere, buy anything anytime. In many ways, what the U.S. offers is hard to beat.

However, as we remind ourselves regularly, convenience and comfort can be highly over-rated. And though the living may be good here, it can be better in many ways elsewhere.

For the second year running, Iraq takes last place in our Index, not a place you'd probably choose to spend time right now.

These numbers are based on the cost of leading a typical international lifestyle in each country, not on a comparison of the locals' purchasing power, and consider typical urban prices for products of comparable quality available in supermarkets or department stores. New York City prices are used as the base for these calculations, so the USA = 100. 

Corruption levels in the public sector should be something that you at least consider when deciding where you want to live or do business overseas.

While most of us don't feel the need to get involved in the actual politics of our host countries, corruption does have some effect on us during our day-to-day lives. Keep in mind that most corrupt government officials didn't become dishonest on Election Day, but rather are a part of a culture where honesty isn't high up on the list of virtues.

In my experience in Latin America, countries with high corruption levels are typically countries where you have to count your change, lock your car doors, and be careful that you're not being over-charged. Taxi drivers normally won't use meters and will over-charge you based on your perceived ability to pay. People will fail to keep promised appointments. Prices are often not marked in stores. Dishonesty is relatively acceptable when compared to North American and European cultures.

Does this ruin your expat experience in a corrupt country? Probably not. Living with cultural dishonesty is something that you'll likely get used to. You'll count your change, check the fare before entering a cab, and hedge against false commitments. You'll learn who is honest and that's who you'll deal with. But it's certainly an important factor to consider.

The 2006 Corruption Perceptions Index is a composite index that draws on multiple expert opinion surveys that examine perceptions of public sector corruption in 163 countries around the world.

This year, countries with significant worsening in perceived levels of corruption include Brazil, Cuba, and the United States. Countries in the Americas with a significant improvement include Uruguay and Paraguay. The best in the world? New Zealand and Finland are tied for first place. The world's worst? Haiti.

Should you choose your new country based solely on this criterion? No. Remember that regions and environments within countries can vary widely, so the destination you are considering may fall outside the norm for the country. Corruption is only one factor of many to think about in your evaluation and there are others that may well be more important in your everyday life.

But for people who come from cultures where honesty is a prime virtue, corruption will certainly be an important aspect to consider. To read the full report, see: www.transparency.org.

-Lee Harrison

Latin America Roving Editor

Ecuador

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