Resources · Shipping basics
Choosing a trade term: what EXW, FOB, CIF and DDP mean for both sides of China–Africa trade
The most common Incoterms® 2020 terms, where responsibility, cost and risk transfer, and how Chinese sellers and African buyers should each choose.
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Under EXW the buyer bears almost everything; under FOB the seller is responsible until loading; under CIF the seller also pays freight and insurance, but risk still transfers at loading; under DDP the seller is responsible up to the door and pays import duties. None is simply better; what matters is who can better control each leg.
Information updated: 2026-10-03
Common terms compared
| Term | Seller is responsible up to | Risk transfers | Import duties |
|---|---|---|---|
| EXW Ex Works | Goods ready at the factory gate | When the buyer collects | Buyer |
| FOB Free On Board | Loaded on board at the Chinese port | When loaded on board | Buyer |
| CIF Cost, Insurance and Freight | Paying freight and insurance to the destination port | When loaded on board (not on arrival) | Buyer |
| DAP Delivered At Place | Delivered to the named place, not cleared | On arrival at the named place | Buyer |
| DDP Delivered Duty Paid | Cleared, duties paid and delivered to the named place | On arrival at the named place | Seller |
How African buyers should choose
- If you have a reliable logistics provider: use FOB or EXW. You control freight and clearance, which is more transparent.
- If it's your first import and you have no clearance experience: use a double-clearance, duties-included provider, or ask the seller for a DDP price.
- With CIF, note that the seller usually buys minimum-cover insurance, and the risk is already yours from loading.
How Chinese sellers should choose
- If you're not confident about clearance in the destination country, don't quote DDP lightly: the duty and inspection risk is yours.
- FOB is the safest, but coordinate cut-off and loading times with the buyer's nominated forwarder.
- When quoting DDP, confirm with your logistics provider exactly what the duties-included scope covers and write it into the contract.