China has announced that it will zero-rate 98% of taxable items originating in another 10 least-developed countries (LDCs), nine of which are in Africa.
The countries are Benin, Burkina Faso, Guinea-Bissau, Lesotho, Malawi, Sao Tome and Principe, Tanzania, Uganda and Zambia.
The other recipient of China’s LDC zero-tariff treatment (ZTT) initiative is Afghanistan.
The ZTT policy, which comes into effect on December 1, will cover 8 786 items, including agricultural products such as olive oil, cocoa powder, nuts, a range of chemical substances, as well as product materials.
China implemented ZTT protocols for Djibouti, Rwanda, Togo, and Laos from September 1.
It is believed that the second batch of ZTT trade recipients will promote economic cooperation between Africa and China.
The latest ZTT development follows an announcement by President Xi Jinping’s government of plans to set up a green lane for African agri-exports flowing into China.
From what is understood, it includes the expansion of the range of products covered by ZTT, ensuring the importation into China of African produce worth $300 billion.
It is further understood that such a development will further bolster the upward trajectory of Africa agri-exports to China, which has grown at a steady pace of at least 11% annually for five consecutive years.
Last year, China imported a record $5-billion worth of agri-products from Africa.
At the moment China is the 2nd biggest importer of agri-products from Africa.
However, there is growing consensus that in due course it could surpass the US as the biggest importer of African agricultural produce, a position that is currently protected and promoted under the African Growth and Opportunity Act (Agoa).
Agoa is due for renegotiation in 2024, and African trade interests are increasingly beginning to talk of stepped-up trade consolidation with China.
Diplomatic signals sent out by the likes of Cyril Ramaphosa’s government, such as its pro-Russian stance in the Ukrainian conflict, could also compromise Agoa in favour of expanding ZTT developments with China.
