Cross-border e-commerce emerges as a new model for China-Africa cooperation
According to a recent report by the African Business Journal, Chinese e-commerce platforms are entering the African market with strong momentum. In January this year, Temu, the cross-border e-commerce platform under Pinduoduo, launched in South Africa, marking Pinduoduo’s first major move into the African market.
Another Chinese overseas e-commerce platform, Shein, is also actively expanding into the African market. According to Reuters, Shein recently opened a pop-up store in South Africa, where products are priced affordably, attracting a large number of consumers. The store was bustling with people inside, and nearly 100 people were waiting in line outside.
In recent years, Chinese cross-border e-commerce platforms such as Alibaba International and Jiku have entered the African market, bringing local consumers a more convenient and efficient shopping experience.
Mao Xiaojing, Director of the Middle East and Africa Research Institute at the Ministry of Commerce’s Institute of International Trade and Economic Cooperation, analyzed in an interview with this newspaper that cross-border e-commerce has emerged as a new business model in China’s cooperation with Africa in recent years. Chinese cross-border e-commerce platforms have been actively expanding into the African market, showing a steady growth trend. “The African countries chosen by Chinese cross-border e-commerce platforms to establish a presence, such as Kenya, South Africa, and Egypt, have relatively well-developed e-commerce infrastructure. Chinese companies often first establish a foothold in these countries before gradually expanding their operations to neighboring nations. Additionally, Chinese companies are not only building e-commerce platforms locally but also establishing a full-chain model that includes supporting services such as warehousing, logistics, and online payment systems,” said Mao Xiaojing.
Founded in 2014, Kilimall is a typical example. As one of the major e-commerce platforms operating in Kenya, Kilimall has set up overseas warehouses in Africa and achieved 100% online payment. Currently, Kilimall covers three major areas: electronic transactions, mobile payments, and cross-border logistics, serving nearly 10 million African users and becoming one of the most popular shopping platforms among local people.
“Compared with traditional e-commerce markets in Europe and the United States, competition in the African market is not particularly fierce, and overall it is a growth market, making it highly attractive to Chinese cross-border e-commerce companies and an important destination for their overseas expansion,” said Li Mingtao, director of the China International E-Commerce Center Research Institute under the Ministry of Commerce, in an analysis for this newspaper. He added that cooperation between China and Africa in the field of cross-border e-commerce is currently worth paying attention to. “In terms of cooperation mechanisms, the ‘Silk Road E-commerce’ cooperation initiative, promoted under the framework of the Belt and Road Initiative, has facilitated the successful implementation of numerous China-Africa cross-border e-commerce cooperation projects, such as the establishment of the China-Africa Cross-Border E-Commerce Service Center and the hosting of the Africa Good Products Online Shopping Festival. Through a combination of online and offline approaches, this initiative not only helps Chinese products ‘go global’ but also assists more African enterprises in selling their products to China via cross-border e-commerce platforms, achieving mutual benefit and win-win outcomes; In terms of service resources, as Chinese cross-border e-commerce platforms expand overseas, many Chinese companies are providing supporting services tailored to the needs of the cross-border e-commerce industry, such as establishing overseas warehouses in Africa to offer services like goods storage, preliminary processing, and after-sales support. Additionally, some payment institutions are gradually expanding into the African market to provide more convenient payment methods that better serve the development of African cross-border e-commerce. In terms of talent cultivation, many African countries are increasingly prioritizing the development of their own e-commerce capabilities, sending large numbers of personnel to China to participate in e-commerce-related training programs to learn from China’s successful experiences.” Li Mingtao said.
Multiple Factors Drive the Development of China’s Cross-Border E-Commerce in Africa
Li Mingtao pointed out that the African market has become a new frontier for China’s cross-border e-commerce due to multiple factors: First, Africa has a large population with a relatively young average age, meaning there is a vast pool of potential consumers, especially young people who are highly receptive to new products, providing a solid market foundation for cross-border e-commerce; Second, Africa’s economy is growing rapidly, and many African governments support foreign investment and offer preferential policies, creating a favorable environment for cross-border e-commerce development. Third, internet and smartphone penetration rates in African countries are rising rapidly, and African consumers are gradually developing online shopping habits, with the e-commerce consumption potential of the African market being gradually tapped.
Statistical data shows that Africa currently has a population of over 1.4 billion, with those under the age of 25 accounting for more than 60% of the total population. Currently, internet penetration rates in African countries are steadily increasing, with over 500 million internet users. An increasing number of Africans are accessing the internet and making mobile payments via their smartphones. According to a report by the Global Mobile Communications System Association, the steady growth of mobile phone penetration, internet connectivity, and social media use in Africa is driving the continuous development of e-commerce. It is projected that by 2027, Africa will have nearly 600 million online shoppers.
“In recent years, the African Union and African countries have attached great importance to the development of the digital economy, including e-commerce. Most African countries have formulated development plans for the digital economy, providing strong policy support for the development of cross-border e-commerce,” said Mao Xiaojing.
The AU’s “Agenda 2063” has identified the digital economy as a priority development goal and proposed flagship projects such as the construction of a pan-African electronic network and an African virtual electronic university. Some African countries have also taken related measures, including developing strategic plans to incorporate the digital economy into national economic priorities, enacting policies, laws, and measures to support the development of the digital economy, improving the digital economic environment, and establishing national-level digital innovation and entrepreneurship centers.
An increasing number of Chinese cross-border e-commerce companies are entering African countries, injecting new vitality into the local e-commerce sector.
“As the Belt and Road Initiative is implemented, a growing number of Chinese companies are investing and setting up factories in Africa. This not only enhances the overall socio-economic development of local areas, creates employment opportunities, and boosts consumer spending power, but also fosters a friendly cooperative atmosphere that has strengthened African consumers’ trust in Chinese companies and products. “Li Mingtao said that through cross-border e-commerce platforms, an increasing number of high-quality, affordable Chinese products are entering the African market, meeting the consumption needs of local residents. At the same time, the barriers for African local enterprises, especially small and medium-sized enterprises, to participate in international trade have been lowered. Forms such as live-streaming sales have brought more ‘African goodies’ closer to Chinese consumers, driving the development of African local enterprises.”
Mao Xiaojing pointed out that China’s e-commerce industry started early and developed rapidly, accumulating rich experience. Strengthening cross-border e-commerce cooperation between China and Africa will not only promote bilateral trade but also bring new opportunities for the development of local e-commerce in Africa. Whether it is improving related infrastructure or cultivating local cross-border e-commerce talent in Africa, these efforts will inject new momentum into the sustained socio-economic development of Africa.
According to data released at the China-Africa Digital Cooperation Forum in late July this year, in recent years, Chinese companies have actively participated in the construction of digital infrastructure in Africa, including submarine and terrestrial cables, 5G networks, and data centers, while increasing investments and services in fintech, e-commerce, and mobile internet, enabling more African users to enjoy the conveniences brought by digitalization.
