Vancouver and Melbourne, Australia, are the best cities in the world for expatriates to live, according to a new survey released Friday by the Economist Intelligence Unit.

Toronto and Montreal are also among the top 10 and Calgary is No. 16, with the report's authors saying "there is very little hardship" for foreign business people living in Canada.

The survey was conducted by the London-based EIU, the business information arm of the Economist Group, as part of its Worldwide Cost of Living service assessing the level of hardship for expatriates in 130 cities.

The hardship rating assesses the cities by looking at 12 factors grouped in three categories: health and safety; culture and environment; and infrastructure.

The survey considers any rating over 20 per cent to represent some form of notable hardship with anything over 65 per cent entailing extreme hardship.

The highest regional average for hardship is in Africa and the Middle East, the report added. While the European Union is the best region, it says North America continues to be a good place to live.

"Despite the increased fear of terrorism and high levels of violent crime in some cities, the United States and Canada have fairly low hardship ratings thanks to a highly developed infrastructure, good education and health indicators and the widespread availability of recreational activities," the survey concluded.

"All the Canadian cities have a rating of 5 per cent or less, while the increased security threat and greater risk of crime means that U.S. cities generally fall between 10 per cent and 20 per cent."

The hardship rating for Vancouver and Melbourne is 1 per cent, for Toronto (ranking No. 4) 3 per cent, for Montreal (ranking No. 8) 4 per cent and for Calgary 5 per cent.

Vancouver was especially praised.

"Almost no aspect of daily life would entail hardship to the expatriate — with climate and transport infrastructure being the only factors that are not seen as ideal," the survey said.

"All Canadian cities feature highly in the rankings indicating that there is very little hardship across the country. The index is lower than the North American average of 10.6 per cent, mainly because of increased crime risks in the neighbouring U.S."

The most comfortable U.S. city is Honolulu, due to its favourable climate, good housing stock, low risk of crime and the availability of recreational activities, the report said. Honolulu ranks No. 21 with a rating of 7 per cent.

"Conversely Washington entails the greatest hardship of the U.S. cities surveyed, at 19 per cent, mainly due to the increased threat of terrorism. This figure still falls below the minimum requirement for a hardship allowance (20 per cent)."

Port Moresby, capital of the Pacific country of Papua New Guinea, is the worst with a hardship rating of 80 per cent. Expatriates in the city must take extreme security precautions, the report said.

The top 10 also included Vienna, Geneva, Zurich, Sydney, Copenhagen, Frankfurt and Oslo.

In Latin America, all cities surveyed entailed some form of notable hardship, but the survey said that in the majority of cities it was not extreme enough to warrant more than a minimum adjustment for expatriates.

The best cities are San Jose, Coast Rica and San Juan, Puerto Rico — both rated at 22 per cent. The Colombian city of Bogota, ravaged by crime and civil war, is the worst with a rating of 54 per cent.

In the Middle East, all cities surveyed had a hardship rating of over 20 per cent, with eight cities rising above 50 per cent.

In Asia, key business centres such as Hong Kong, Singapore, Tokyo and Seoul all have low hardship ratings.

"However, the region is also home to cities where expatriates encounter severe hardship. Mumbai (India), Phnom Penh (Cambodia), Dhaka (Bangladesh) and Karachi (Pakistan) all have ratings of over 60 per cent because of political instability, corruption and inadequate infrastructures — as well as harsh climates," the report said.