Highlights
- China announces a comprehensive tariff-free trade pact with 53 African countries, eliminating import duties and opening massive market opportunities.
- The deal strategically positions China to deepen economic ties with Africa, particularly in critical minerals and rare earth supply chains.
- This landmark agreement challenges Western trade models and potentially reshapes global economic relationships.
- Significant implications for mineral resource access and geopolitical influence.
Imagine crates of Kenyan avocados, Congolese cobalt, and Rwandan coffee en route to China – all without in theory, paying a dime in tariffs. In mid-June 2025, China announced a sweeping new tariff-free trade pact with Africa, a move that’s turning heads from Nairobi to Washington. What’s the deal? Essentially, Beijing will remove all import tariffs on goods from 53 African countries (every nation it has diplomatic ties with). This was unveiled at a meeting in Changsha, China (opens in a new tab) – a follow-up to last year’s big China-Africa summit – where Chinese officials and African ministers shook on the plan. The only African country left out is Eswatini (which recognizes Taiwan and lacks relations with Beijing), making this nearly a continent-wide free trade gesture For many in Africa, the announcement was welcome – one report described applause in ministerial corridors from Nairobi to Niamey as leaders saw new opportunity to boost exports. But what are the prospects for Africa to move up the rare earth and critical mineral supply chain ladder (opens in a new tab)?
Note the devil remains in the details. Rare Earth Exchanges (REEx) can only report on what has been stated thus far. However, full implementation requires further negotiations and formal treaties, and many things could change, including savvy and unorthodox American intervention (see below).
Who Is Involved and When Was It Signed?
The pact isn’t a single bilateral treaty but a broad economic arrangement between China and the African continent. Chinese President Xi Jinping’s government is driving it, and African Union members are the beneficiaries, particularly those in sub-Saharan Africa who crave better access to the world’s second-largest economy. The idea was rolled out in June 2025, during a high-level China-Africa meeting, under the Forum on China-Africa Cooperation framework.
It builds on commitments made at a September 2024 Beijing summit, where China promised deeper trade ties. While full implementation details are still emerging (China said it will negotiate and sign the formal pact soon, the political will is clear: Beijing is throwing open its market to Africa. Crucially, this isn’t limited to the poorest countries.
China has already offered duty-free access to many of the least-developed African states, but now even Africa’s larger economies, such as Kenya, Nigeria, South Africa, Egypt, and Morocco, will join the club. “It enables middle-income countries like Kenya, South Africa, Nigeria, Egypt, and Morocco… to now enter the Chinese market duty-free,” explains Hannah Ryder, an Africa-focused economist, reported Duncan Miriri at Reuters. In short, who gains is essentially all of Africa (minus one), and when is now – the deal was announced in mid-2025 and is expected to take effect after final agreements are signed soon.
Why Are China and Africa Doing This?
From China’s perspective, this move is a shrewd blend of geopolitics and economics. First, Beijing is addressing a long-standing gripe: the China-Africa trade imbalance. China has been Africa’s top trading partner for over a decade, but mainly as an exporter of manufactured goods. In 2023, China sold approximately $173 billion worth of goods to Africa, while importing only $110 billion, resulting in a substantial trade surplus of $ 63 billion, favoring China, according to ODI (opens in a new tab) Global.
Most African exports to China are raw materials (oil, minerals, unprocessed commodities), whereas China floods African markets with electronics, machinery, and textiles, according to an ODI Global report. This dynamic has raised eyebrows among African leaders. Uganda’s President Yoweri Museveni, for example, publicly urged Beijing to buy “processed coffee and other products, not only raw materials (opens in a new tab)” from Africa.
By scrapping tariffs, China is signaling it got the message: it wants to “welcome quality products from Africa (opens in a new tab)” and not just minerals if more African goods find a market in China, African economies benefit – and over time, that could reduce the trade gap and ease complaints about China profiting at Africa’s expense.
Second, China’s motivations are strategic. This tariff pledge came as Chinese and African officials jointly critiqued Western protectionism at the Changsha meeting. Both sides bristle at moves like U.S. tariffs and trade wars that roil global markets as discussed via the Hinrich Foundation (opens in a new tab).
By positioning itself as a reliable partner, in contrast to an America often seen pursuing its trade fights, Beijing garners goodwill across Africa. The timing is notable: the U.S. is currently wrestling with its trade policies (and was even late in renewing its African trade preference program). China is effectively saying, “We’re open for business, no strings (or tariffs) attached,” seizing a soft-power advantage. There’s also a practical angle: China’s economy hungers for resources and new markets. Easing access to African goods means a steadier supply of everything from foodstuffs to metals that China’s factories need. And it’s a two-way street – tariff-free access might encourage Chinese companies to invest even more in Africa, knowing they can re-export African-made products back home at a competitive rate. In short, China gains goodwill, resources, and influence.
From Africa’s perspective, the deal is largely a no-brainer. It opens the door to the vast Chinese market of 1.4 billion consumers. African farmers could sell more tea, coffee, fruits, and textiles abroad if they become cheaper in China. Manufacturers in places like Ethiopia or Nigeria might finally find a foothold to export finished goods to China. The hope is to move beyond raw materials and climb the value chain – exactly what leaders like Museveni have been asking for. Moreover, African nations that graduate from the “least developed” status (such as Kenya or Ghana) no longer have to worry about losing market access; China’s offer extends to them as well, leveling the playing field that previously favored only the poorest countries. It looks to be politically a win for African governments who can show citizens and businesses they’ve secured new opportunities abroad. It fits neatly with the vision of the African Continental Free Trade Area (AfCFTA) – Africa’s mega pact to boost intra-continental trade.
AfCFTA aims to help African countries industrialize and eventually export more to partners like China, so Beijing’s tariff gesture complements that goal odi.org (opens in a new tab). There is, of course, a “why not?” factor: unlike deals with Europe or the U.S., China’s offer comes with fewer conditions. No lectures on governance or environmental rules in this trade pact – just an open door. For many African leaders, that straightforward approach is appealing. As one analysis noted, China’s zero-tariff promise is seen as Beijing making the most of the moment – capitalizing on global trade shifts (like Trump-era tariffs) to present itself as Africa’s all-weather friend.
A Hidden Agenda? Impact on Critical Minerals and Rare Earths
Beneath the warm glow of avocados and Rwandan coffee lies the cold steel of strategic ambition: Africa’s mineral veins are rich with the ores that power the future—cobalt, lithium, manganese, and the ever-elusive rare earths. China’s new tariff-free trade gesture is not mere benevolence; it is a calculated tightening of an already formidable grip. The Democratic Republic of Congo (DRC), which produces over 70% of the world’s cobalt, has become a cornerstone of Beijing’s resource empire, with Chinese stakes in nearly every major mine. Note that America also makes its play for more engagement, having recently supported a peace deal process with rebels in the DRC.
Rare earth elements—as the Rare Earth Exchanges (REEx) community (opens in a new tab) knows well —the invisible engines inside wind turbines and fighter jets are already processed overwhelmingly in China. By removing tariffs on African imports, China streamlines the supply chain—raw minerals now flow more smoothly, cheaply, and quickly into its industrial bloodstream.
But for Africa, this is a golden deal laced with thorns. Tariff-free access to China promises a surge in exports and earnings; yet, the real wealth lies in what happens after the ore is mined—from refining to manufacturing. That “midstream” leap remains mostly in Chinese hands.
Africa risks repeating history: exporting bounty, importing finished goods. Unless African nations push back—insisting on local processing, regional battery hubs, and retaining more value at home—this pact may deepen dependence rather than disrupt it. China fortifies its clean-tech dominance, while the West watches a critical mineral chessboard shift further east. Whether Africa can rewrite its role from quarry to factory remains the continent’s high-stakes move in a rapidly realigning world.
Implications: What It Means for the U.S. and Europe
China’s all-access tariff-free trade pact with Africa isn’t just a diplomatic gesture—it’s a gauntlet thrown at the feet of the West. While Washington dithers over renewing the African Growth and Opportunity Act (AGOA), Beijing delivers a bold, strings-free offer covering nearly the entire continent. Although we don’t often see this in mainstream media, the U.S., once the favored partner through AGOA’s conditional generosity, now watches its influence wane as China positions itself as Africa’s dependable buyer, builder, and lender. With no lectures on governance or exclusions for “sensitive” goods, China’s economic overture is winning hearts and contracts. It’s a wake-up call: if America wants to compete, it must trade less on nostalgia and more on tangible opportunity. Can Trump 2.0 turn this around? His administration’s move in the DRC is a start, but he needs to do a lot more.
Europe faces the same reckoning. Saddled by ESG idealism and slow bureaucracies, EU firms are being outpaced by Chinese rivals who bring roads, rail, and ready cash—no compliance maze required. As China deepens ties with African mineral exporters, European industries may find themselves forced to buy the raw materials of the green revolution from Beijing. The irony stings: while the West champions sustainability, China is securing the cobalt, lithium, and rare earths that will power it. Africa holds the cards, and it’s no longer waiting for lectures from Brussels or Washington. The question now isn’t whether China is winning—it’s whether the West can catch up before the game is lost.
Implications
China’s newly minted tariff-free deal with Africa is a landmark in China-Africa relations – and a lively plot twist in the story of global trade. We’ve covered what it is (a promise to eliminate tariffs on African goods), who is involved (China and almost the whole African continent), when it happened (announced June 2025, with implementation looming), and why it came about (to boost trade, curry favor, and secure resources – a win-win on paper). For ordinary readers, the upshot is this: expect to see more “Made in Africa” products in Chinese markets, from South African wine to Zambian honey.
The deal could give African economies a shot in the arm, though the real gains will depend on what they’re exporting – raw minerals or refined goods. Critical minerals and rare earths, the under-the-radar stars of this saga, stand to further entwine Africa’s mines with China’s factories, for better or for worse. And in Washington and European capitals, don’t be surprised if this pact sparks some soul-searching (and perhaps new policies) as the West figures out how not to be outplayed in Africa.
In a nutshell, REEx suggests China’s free trade gambit in Africa is both an economic opportunity and a geopolitical chess move. It demonstrates China’s confidence in expanding its global reach and Africa’s significance as the next major prize in international economics.
Whether this partnership yields sustainable development for African nations – or simply locks in old patterns of raw materials for finished goods – will be a story to watch in the years ahead. One thing’s for sure: the race for Africa’s markets and minerals just got a lot more interesting, and frankly, intense. Buckle up, because the trade winds are blowing toward the east, and everyone else will need to adjust their sails accordingly.
What can the USA do?
China’s sweeping tariff-free trade pact with 53 African nations isn’t just an economic policy—it’s a strategic masterstroke. But the U.S. still has tools to shift momentum. To compete with Beijing’s growing influence in Africa’s mineral wealth and influence, Washington must break with conventional aid-and-preference models and pursue bold, outcome-driven engagement.
Below are seven unorthodox but actionable moves the U.S. can make to reframe its relationship with Africa, anchored in mineral value chains, industrial partnership, and long-term geopolitical alignment.
| Strategy | Description | Purpose |
|---|---|---|
| Transform AGOA into a Strategic Investment Platform | Convert AGOA from a passive trade preference to a deal-making framework that includes co-investment, infrastructure finance, and equity support for mineral value addition. | Compete with China’s “tariff + infrastructure” model and build deeper trade stickiness. |
| Mobilize DFC & EXIM Bank for Joint Ventures | Use the U.S. Development Finance Corporation and Export-Import Bank to back U.S.-Africa mineral extraction and processing projects, especially in DRC, Zambia, Namibia, and South Africa. | Counter China’s dominance in offtake agreements and strengthen U.S. supply access. |
| Export Modular Clean-Refining Tech | Deploy small-scale, ESG-compliant processing tech (e.g., for REEs or battery-grade lithium) via public-private partnerships. | Help African nations move up the value chain while differentiating from China’s high-emissions model. |
| Negotiate a Strategic Critical Minerals Compact | Launch a multilateral pact with the African Union/AfCFTA focused on traceability, beneficiation, transparency, and long-term offtakes for U.S. firms. | Institutionalize U.S. alignment with African industrialization and counter China’s bilateral dominance |
| Deploy Security + Governance Guarantees | Embed critical mineral development into regional stabilization, anti-corruption, and peacekeeping efforts (e.g., DRC peace deal). | Gain trust and safeguard mining corridors from insurgency and illegal extraction—where China often turns a blind eye. |
| Establish an African Critical Minerals Exchange | Co-create a rare earth and battery metals trading platform with African nations and Afreximbank, listing juniors and spot/futures contracts. | Democratize capital access, reduce dependence on Chinese syndicates, and price minerals competitively. |
| Institutionalize African Voices in U.S. Trade Strategy | Create a standing African Trade & Investment Council inside USTR or Commerce with seats for African ministers, civil society, and SOEs. | Shift from a paternalistic model to co-creation—earning trust and helping set joint industrial priorities. |
China isn’t merely purchasing Africa’s mineral bounty—it’s embedding itself deep into the midstream, locking in control over processing and long-term influence across global supply chains. Today, more than 70% of the Democratic Republic of Congo’s cobalt production and the lion’s share of rare earth exports from the continent flow directly into Chinese-controlled channels. In contrast, the U.S. relies heavily on outdated trade preference programs, such as AGOA, which—while well-intentioned—pales in comparison to China’s state-backed infrastructure-for-resources model. If Washington wants to remain relevant, AGOA must evolve into a strategic gateway for investment, rather than just providing market access.
Crucially, African nations are not looking for handouts or paternalism—they want partners. What they value is co-developed infrastructure, equitable access to global markets, and the ability to move up the value chain through localized refining and manufacturing. The U.S. must meet this moment with tools that resonate: modular, mobile, and, where relevant, ESG-compliant technologies that American firms already possess.
These innovations have the potential to challenge China’s high-emission refining dominance—if paired with the right financial and diplomatic incentives. But time is running out. As Beijing eliminates tariffs and rapidly scales up its African mineral integration, the U.S. must act decisively to secure critical supply chains, foster regional goodwill, and rebalance the geopolitical equation before the window closes.
REEx African-American Reflection
To win in Africa, Washington must think like an investor, build like a partner, and act like a competitor. That means putting minerals, manufacturing, and mutual prosperity at the heart of a renewed U.S.–Africa relationship. Anything less cedes the ground—literally and geopolitically—to Beijing.
In today’s America-First and MAGA paradigm, this may be different. But a resilient rare earth element, as well as a critical mineral supply chain, as we have argued here at REEx, requires a substantial global alliance, which can greatly help America’s decoupling from China dependency.
Critical Investor Questions
Here is a targeted list of highly relevant due diligence and strategy questions for both retail and institutional investors involved in the rare earth and critical mineral supply chains, inspired by the developments in the China-Africa tariff-free trade pact:
Strategic Investment & Risk Assessment
- How will China’s tariff-free access to African critical minerals reshape global supply dynamics for rare earths?
→ Could it further entrench China’s dominance over both upstream extraction and midstream processing?
- Which African countries are poised to increase exports of rare earths and battery metals to China, and are their projects investable?
→ Is there undervalued exposure in jurisdictions like Burundi (REEs), DRC (cobalt), Zimbabwe (lithium), or South Africa (REEs)?
- Will this deal accelerate China’s control of African mine offtake agreements—and how does that affect global spot and long-term prices for NdPr, Dy, Tb, Li, Co, and Mn?
- Does this trade shift undermine Western critical mineral diplomacy?
→ Should investors reassess the value of MOUs and supply deals signed between African nations and the EU or U.S.?
Midstream and Refining Infrastructure
- Are there African-led or Western-backed refining or processing hubs (e.g., in Zambia, DRC, South Africa) that could become viable alternatives to Chinese midstream dominance?
→ What are their power, logistics, and ESG risk profiles?
- Which companies—public or private—are actively building local beneficiation capacity in Africa, and do they represent early investment opportunities?
- Can AfCFTA and new local-content laws succeed in retaining more value within Africa, or will most raw ore continue to flow unprocessed to China?
Policy and Trade Exposure
8. How might the potential non-renewal or weakening of AGOA or EU-African trade incentives shift investor exposure or risk?
9. Are Western firms or funds vulnerable to losing access to African minerals that are now being directed more directly to China?
→ Should supply diversification strategies be reassessed?
- Could ESG constraints in Western investment vehicles become a liability in Africa’s fast-moving, China-favored trade environment?
Market Timing & Competitive Positioning
- Is this an inflection point for capital to pivot toward African exploration and junior mining equities, with China’s tariffs giving a near-term price boost?
- Which rare earth and battery metal juniors operating in Africa are best positioned to benefit from Chinese demand, directly or via acquisition?
- Should Western institutional investors consider co-investment models with African sovereigns or China-aligned entities to remain competitive?
- If China increases processing of African feedstock, will that further widen the East-West rare earth price differential and marginalize Western magnet supply chains?
This REEx question set is designed to drive portfolio-level thinking, supply chain scenario modeling, and geopolitical risk assessment—vital for investors with exposure to rare earths, battery metals, and Africa’s emerging role in the global clean-tech materials sector.
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