Santa Marta, Colombia’s most expensive city for cost of living

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The colonial city of Santa Marta, second oldest in South America, and departmental capital of Magdalena bore the brunt for the highest inflation during December 2021, compared to every other Colombian city. According to the most recent consumer price index by the National Statistics Department DANE, Santa Marta’s 8.99% increase over the same period last year was driven by rising costs for housing, food, transportation and public utilities.

Cúcuta, capital of Norte de Santander, ranked second at (8,69%), and Popayán third (8,42%).  The national average stands at 5,62%, with Bogotá ranked lowest at 4,62%.

The sectors that saw the sharpest increases were food and non-alcoholic beverages (17%), restaurants and hotels (9%). These increases are among the highest on record. The largest price increases for consumers in terms of food are potatoes (111%), vegetable oils (48%) beef and meat derivatives (33%). Rice, yams, onions and other perishables either increased with the national average or decreased in price.

Santa Marta’s Economic Development Secretariat Iván Calderón stated that much of the increase for the half a million residents of the coastal city can be attributed to the fact that the tourism sector has been closed for almost two years of the coronavirus pandemic, and with economic reopening, hotel and restaurant owners were forced to increase prices to pay debts, furloughed staff, as well as higher electricity rates with the city’s new operators.

Calderón also emphasized that the prolonged National Strike (Paro Nacional) disrupted key supply chains, among them dairy and poultry production, staple foods in the coastal diet. The price hikes come as the minimum wage in Colombia increased 10.7% as from January 1, 2022, and largest decreed by a national government.