When I first arrived the comparison problem was that you seen everything was cheap e.g. you see something and think of the cost in the UK and thought it was a bargain. What has happened in the last 12 months though is the pound has collapsed against the Peso due to the Peso being artificially inflated with money coming into the country every month via remittances. This in reality has seen around 20%+ shaved off the value of a pound which when I first arrived was around P98 to the pound and now its around P68/69 most of the time. Problem is its not reflected in local produce as the rest of the world woke up to the fact it needed to reduce prices to keep its retail markets afloat the Philippines hasn’t had that happen and I have still seen prices rise at inflated levels on many products.
Now if your looking at a sack of rice which normally lasts us about 3 months its around P2,000 a sack but things like Chicken are now close to the same price I would be paying at Tesco’s difference being the quality of the bird. Generally food prices have either increased or stayed the same yet for most Expat’s that have outside incomes the ratio on the exchange rate has affected them. We are quite lucky in the fact we are living on incomes within the Philippines not needing external incomes but it doesn’t mean when I look at a compressor that is P12,000 I would be happy to pay that price for a second hand unit with a lick of paint missing its attachments (they sell you seperate!) when I know the same unit brand new in the UK would be around P7,000.
So when it comes to cost of living you really need to look across the board on how you live and what you need not only on a daily basis but for things like construction as it does pay to import things if you can get round a lot of the issues on importation.