China shift of business model in Africa from that of creditor to stronger trade and investment, is an evolution, rather than transformation, meant to take advantage of the continent’s integration protocols.

A new report launched this week suggests that, rather than abandoning its partnerships with African countries, Beijing is adapting its approach while leveraging its existing relationships established through credit deals.

This could give it a head start in the geopolitical race against rivals such as the US, as well as new potential partners like the Gulf states, India and Turkey.

These observations are contained in a report by the Global Development Policy Centre. Entitled China-Africa Economic Bulletin (2026 Edition), the document states that China’s era of large-scale infrastructure loans and resource-based arrangements is giving way to a more varied and, in some respects, more cautious engagement with Africa.

Africa is also moving away from the old aid-and-infrastructure model towards debt sustainability, industrialisation, and adding value.“The era of large-scale infrastructure loans and resource-based arrangements is giving way to a more varied and, in some respects, more cautious engagement. Africa’s own priorities are also shifting, moving away from the old aid-and-infrastructure model towards debt sustainability, industrialisation and value addition,” the report says.

China’s deal with Africa through trade and investment has been further strengthened by the African Continental Free Trade Area (AfCFTA), as well as by President Xi Jinping’s recent decision to eliminate tariffs on goods and services from 53 out of 54 African countries, effective from 1 May 2026.

Eswatini was excluded due to its diplomatic ties with Taiwan, which Beijing considers to be part of Chinese territory. The deal will particularly benefit African agricultural exports such as Kenyan coffee, South African citrus fruits, and Ivory Coast and Ghanaian cocoa.

This two-year tariff-free policy aims to strengthen China’s trade ties with Africa by offering exporters access to a lucrative market. The scale of China–Africa trade underscores the significance of this development, with trade between the two regions reaching $348 billion in 2025, marking a 17.7 percent increase from 2024.

Chinese exports to Africa dominated trade flows, amounting to $225 billion — a 25.8 percent increase. This compares to $123 billion in imports from Africa, which grew by just 5.4 percent. This rising trade deficit between Africa and its largest sovereign trade partner highlights the need for new Chinese policies that support African exports to China.

The London-based development think tank ODI Global said the AfCFTA agreement, which came into force on May 30, 2019, gives Beijing the upper hand in its engagement with the continent.

The opening up of the intra-African market of around 1.3 billion people enables Chinese companies investing in Africa to secure a return on their investment and sell their products beyond the borders of the country in which they are basedIt also promotes the growth of regional value chains by offering Chinese businesses access to a large unified African market. The AfCFTA provides for elimination of tariffs between African countries and other barriers to trade. The agreement entered into force on May 30, 2019 and trading under the free trade area commenced on January 1, 2021.

Africa’s continental trade pact offers significant opportunities not only for African economies but also for their foreign trade partners – none more so than the largest, China.

While China is perhaps best known in Africa for funding infrastructure megaprojects, its spending on infrastructure has decreased in recent years, even as it maintains its foreign direct investment (FDI).

Read: China dangles duty-free access to Africans with diplomatic ties with BeijingSince 2005, African least developed countries have enjoyed zero-tariff access to China across 100 percent of tariff lines. This policy restricted zero-tariff trade access to around 33 countries (subject to change owing to income growth and diplomatic recognition of Beijing), but Africa’s middle-income exporters were excluded from trade preferences.

By extending zero tariffs to almost all African countries, China has neutralised an element of distortion in its earlier tariff policy. According to the China-Africa Economic Bulletin (2026 Edition), Chinese loan commitments to Africa have declined sharply since 2020, falling below $5 billion annually.

During the 2010s, they exceeded World Bank lending in several years and, after 2020, are broadly comparable to African Development Bank lending levels.

In 2023, eight African countries and two multilateral African borrowers received 13 loans totaling approximately $4.61 billion, followed by six loans worth $2.1 billion in 2024. The largest lending volume went to the financial sector, followed by transportation and energy.

No new lending to coal, oil or gas projects in Africa has been recorded since 2019. However, lending to non-hydro renewables (solar, wind, nuclear and geothermal) remained small in scale at approximately $1.7 billion combined over 2000-2024.

In 2024, Africa’s trade with China reached a record value of $275 billion, including $182 billion in imports (6.3 percent of GDP) and $93 billion in exports (3.2 percent of GDP).

Driven by a larger increase in exports, especially in extractives, Africa’s trade deficit with China dropped slightly from $91.9 billion in 2023 to $89.6 billion in 2024.

China accounted for 16 percent of Africa’s total exports and 28 percent of total imports.

Chinese FDI in Africa rebounded strongly in 2023 and 2024 following pandemic-era lows, largely driven by a small number of large projects rather than a broad-based surge.

Between 2000 and 2024, China’s share of African exports rose from 0.7 percent to 3.2 percent of GDP despite intermittent fluctuations.

Over the same period, China’s share of African imports increased more steadily from one percent to 6.3 percent of GDP.

China was the leading export destination for 19 out of 54 African countries in 2024, up from 17 in 2014.

For a subset of resource-intensive economies like Guinea, the Democratic Republic of the Congo (DRC), Eritrea, Sierra Leone, Zimbabwe, South Sudan and Zambia, China absorbed over 50 percent of export value in 2024, with its share substantially exceeding that of the second-largest partner.

In some countries, China is among several major export destinations, reflecting a broader pattern of trade diversification. For instance, Gambia directed 38 percent of its exports to China and 29 percent to India in 2024.

In 2024, 39 African countries recorded trade deficits with China, half of which were below $1 billion. The largest deficits were in Nigeria ($17.5 billion), Egypt ($16.6 billion) and Liberia ($13 billion), while surpluses were concentrated in resource-exporting economies, notably the DRC ($17.2 billion) and Angola ($13 billion), which together accounted for 70 percent of Africa’s total surplus with China.

© Copyright 2026 Nation Media Group. All Rights Reserved. Provided by SyndiGate Media Inc. (Syndigate.info).