Chinese commercial activities in Africa, which were primarily led by state enterprises, are increasingly focusing on consumer goods from private firms.
As Africa’s rapidly expanding economies, including Kenya, Uganda, and Zambia, experience annual growth rates of 4.8%, 6.4%, and 5.8%, respectively, the GDP for the entire continent’s over 50 countries stands at 4.1%. This is according to the latest IMF economic outlook report.
Investment from China in Africa’s resource-heavy sectors has dropped by around 40% since its peak in 2015, influenced by lower returns and declining construction income in traditional commodity sectors, as highlighted by the Rhodium Group’s China Cross-Border Monitor released on November 18 this year.
In contrast, China’s exports to Africa have climbed by 28% year-on-year over the first three quarters of 2025, following a 57% rise from 2020 to 2024, according to the report. Most of these exports consist of higher-value-added manufactured items like electronics, plastics, and textiles.
“Initially, Chinese firms were primarily engaged in infrastructure projects and the mining of natural minerals,” stated Joe Ngai, chairman of McKinsey Greater China.
“In recent years, there seems to be a shift towards focusing on the African consumer market,” he added. However, he cautioned that market fragmentation and slim profit margins could complicate these efforts.
This transition coincided with the inaugural G20 summit held on the continent, which commenced over the weekend in South Africa. While the U.S. dispatched only its acting ambassador, Chinese Premier Li Qiang represented Beijing, creating increased opportunities for high-level business discussions.
Unlike previous years when people in China were largely unaware of developments in Africa, nowadays there are “more business trips, sending more employees abroad. It simply feels more engaged,” said Heather Li, founder and China-Africa consultant at The Dot Connector. She noted that an increasing number of larger Chinese corporations are dispatching decision-makers to Africa to investigate particular market prospects.
In the face of power shortages in West Africa, Li remarked that Chinese solar products are well-received there, while medical supplies, as well as baby and household items, enjoy popularity throughout the continent.
Already, the Chinese smartphone brand Transsion has established its presence in Africa over the years, alongside telecom giant Huawei and home appliance maker Midea who have also broadened their operations in Africa.
In July, Chinese state media reported that Midea signed an agreement with the Confederation of African Football to enhance investments in the region. The company has already established factories in Egypt and harbors plans for further expansion.
Increasing Chinese social media focus
The changing environment is clear not just in investment figures but also in experiences relayed by Chinese entrepreneurs on social media.
On platforms like Xiaohongshu and Bilibili, postings from the past year depict Africa as a burgeoning location for smaller, flexible business ventures including dropshipping, e-commerce, and manufacturing connected to Chinese supply chains.
One trader of earphones and data cables shared his move from China to Nigeria and his quest to find African collaborators, while another social media profile followed the journey of a business owner’s bubble tea shop in Kenya. The posts showcase entrepreneurs marketing slippers, minor appliances, furniture, and press-on nails.
Joseph Keshi, a Nigerian-born real estate investor and business strategist who has collaborated closely with Chinese entrepreneurs, stated that some of them have earned as much as six figures in U.S. dollars in their first year.
While Li cautioned that some social media portrayals might be exaggerated, she acknowledged that this visibility might boost Chinese recognition of opportunities in Africa.
Euromonitor data confirmed that this trend is occurring on a broader scale, demonstrating how numerous Chinese ventures in Africa sell essential consumer products like diapers, household items, packaged sauces, and snacks.
“As urbanization accelerates, with a youthful and increasingly digital-savvy population, household expenditure across the continent is expected to surpass US$2 trillion by 2030,” stated Christy Tawii, regional insight manager at Euromonitor International.
She also highlighted the rise of e-commerce platforms such as Chinese Supermarket, which enhance the availability of Asian and Chinese brands to African households.
Many of these entrepreneurs hold optimism that increased utilization of the Chinese yuan in Africa could mitigate transaction risks and strengthen business connections. Currently, the Chinese yuan is involved in “30% of trade invoicing,” according to the Rhodium report.
However, Rhodium Group and Atlantic Council indicate that there’s a “structural ceiling” to the yuan’s increased use, citing China’s trade surplus with most African partners and the global dependency on the U.S. dollar.
Challenges of an export-only model
The surge in interest from Chinese consumer enterprises in Africa occurs as profit margins shrink domestically due to slowed economic growth and fierce competition.
Marketing to African consumers has become increasingly appealing to Chinese firms in light of trade barriers with the U.S. and Europe, as noted by the Rhodium Group. The analysts presented a “stagnation scenario” where Chinese exports increasingly gravitate towards regions like Africa if China cannot address its overcapacity challenges and faces additional restrictions in Europe.
While affordable imports benefit consumers, much like in other regions, a surge of low-cost exports may threaten local manufacturing and exacerbate trade imbalances.
“It is essential to view Africa not merely as a consumer market, but as a region that produces goods for its own consumption,” remarked Ebipere Clark, visiting fellow and consultant at the African Policy Research Institute.
Certain Chinese firms are already beginning to manufacture locally.
“There is a growing push for industrialization in Africa,” said Li from The Dot Connector. “I’ve engaged in consulting projects aimed at attracting Chinese light industries to relocate manufacturing in Africa, which would also give them preferential access to U.S. and European markets.”
Guangzhou-based trading entity Sunda International offers a wide array of products from agricultural tools to everyday consumer items, and claims to have expanded its establishment of more than 20 production facilities across Africa during the past decade.
Sunda is reported to earn up to $450 million each year by supplying essential products within Africa, such as baby diapers and sanitary items.
A number of Sunda’s listed factories are situated in Zambia, where Premier Li last week signed a $1.4 billion deal to upgrade a railway linking Zambia to the Indian Ocean, aiming to significantly boost freight capacities.
