Illicit PRC-linked Finance Enables Arms Diversion in Africa

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Three PRC nationals were convicted for charges related to illicit mining and money laundering in the Democratic Republic of the Congo in January. (Source: Central News)

Executive Summary:

  • Judicial cases in the Democratic Republic of the Congo and in Nigeria confirm that citizens from the People’s Republic of China (PRC) are active in both resource extraction and digital offshore laundering networks, connecting illicit resource economies and stablecoin settlement into value chains that sustain conflict.
  • Gold, timber, and crypto flows move through the same corridors that carry PRC-manufactured weapons into embargoed zones. This integration creates a shadow liquidity system in which capital and material reinforce one another, allowing African militant economies to become self-financing and resilient to external pressure.
  • Existing regimes treat arms diversion and money laundering as separate issues. They are not. Addressing this challenge requires collapsing the divide between arms embargo enforcement and financial crime intelligence into a single operational continuum.

The circulation of weapons manufactured in the People’s Republic of China (PRC) has become an increasingly visible feature of African conflicts. Earlier research by this author traced how Chinese small arms and light weapons appear in the hands of militant groups across the continent, often in ways that reveal the fragility of existing control mechanisms (China Brief, November 1, 2024; U.S. Senate, July 2025). That research underscored the scale of material leakage from licit trade into irregular markets. Since then, more evidence has come to light to suggest that the story does not end with the physical movement of arms.

Alongside weapons, Chinese illicit finance networks are spreading across Africa’s conflict zones and beyond. These networks have the capacity to enable militant actors to not only acquire weapons but also to sustain self-financing economies of violence and extraction. They tie the diversion of arms to capital flows that are deliberately routed through opaque offshore structures, informal value transfer systems, and state-aligned facilitators.

Illicit finance is not a peripheral concern. It is a structural enabler of militant economies and arms transfers. Understanding the fusion of financial and material supply chains is therefore essential for grasping how African conflicts are evolving, and how external actors shape them.

Chinese Criminals Embedded in Conflict Economies

In January, a court in Bukavu, a war-torn community in the eastern Democratic Republic of the Congo, handed down a rare and decisive judgment against three PRC nationals involved in illicit extractive activity. The defendants were convicted for operating illegal mining concessions and laundering proceeds through both cash and precious metals (South China Morning Post [SCMP], January 15). Authorities seized more than $400,000 in hard currency alongside a quantity of gold bars, establishing a direct evidentiary trail from resource extraction to illicit financial flows (Central News, January 16). Because this conviction was adjudicated in court, it created a judicially verified record of PRC actors engaging in illicit commerce within a conflict zone. The absence of PRC media coverage of this case is telling.

The defendants did not operate in a vacuum. The PRC maintains a visible commercial footprint across eastern Congo’s extractives economy, including Chinese-owned buying houses, traders, and small-scale gold operations in war-torn South Kivu (ECOFIN, December 30, 2024). PRC state media has even warned PRC nationals of the legal and security risks of doing such business in the war-torn region, explicitly mentioning mining activities (Xinhua; Consular Express WeChat Official Account, July 28). Congolese officials and local communities have repeatedly objected to illicit practices attributed to Chinese operators (ACP, November 15; Radio Okapi, August 8).

The Bukavu convictions confirm that Chinese illicit financiers are present inside eastern Congo’s conflict zones. A panel of UN experts reported to the press that minerals extracted from areas in eastern Congo controlled by the Congolese Rwandan-backed rebel paramilitary group M23 are being smuggled through Rwanda and Uganda before entering global markets (AfricaNews, January 10; Al-Jazeera, July 18). At the same time, M23 rebels have been documented with significant stocks of PRC-manufactured weapons and equipment, consistent with supply via their Rwandan and Ugandan backers (China Brief, November 1, 2024). The PRC is the world’s dominant processor of the ore coltan, gold, and other Congolese exports, and both Rwanda and Uganda ship far more of these minerals than they produce (Enact, May 3, 2022; Haitong, April 23, 2023; CASS West Asia and Africa Research Institute, March 2024; AllAfrica, December 18, 2024). Taken together, these facts make PRC end-use not speculative but structurally inevitable: illicit finance on the ground, smuggling through neighbors, and end-user demand in the PRC form a single chain that helps sustain this conflict economy.

These dynamics are not confined to eastern Congo. Across Africa, PRC nationals are embedded in commodity corridors that move value and provide logistics. In 2022, roughly 435 tonnes of gold were smuggled out of Africa, 93 percent of it bound for the United Arab Emirates (UAE), with PRC buyers active at both ends of the chain (SCMP, November 16, 2023; Swissaid, May 30, 2024; Africa Report, October 24, 2024). PRC-linked syndicates also dominate timber and rosewood exports from the Sahel, Central, and East Africa, often sourcing directly from insurgent-affected areas (African Development Bank, 2021). These gold and timber corridors easily provide the financial and logistical backbone for broader illicit trade, establishing flows of capital and transport capacity that could be redirected toward arms procurement or militant financing.

Chinese Criminals Laundering Crypto

In July, a federal court in Lagos, Nigeria ordered the forfeiture of approximately 223,000 Tether ($223,000)—the U.S. dollar-pegged stablecoin—from two PRC nationals convicted of fraud and money laundering (EFCC, July 21). The case was notable not only for the scale of the seizure but also for its judicial confirmation that PRC nationals were operating through crypto networks in Nigeria. It followed an earlier wave of enforcement in December 2024, when Nigeria’s Economic and Financial Crimes Commission (EFCC) carried out mass raids that led to the arrest of 792 suspects. Among those implicated were 148 PRC nationals accused of participating in coordinated crypto fraud and laundering schemes (Toutiao, April 27; African Mirror, December 19, 2024). Together, these cases establish a pattern of sustained involvement by PRC nationals in illicit digital finance across West Africa.

The pattern is clear: PRC illicit finance networks have embedded themselves into West African stablecoin rails. These rails enable frictionless cross-border settlement that can be directed toward extractive rents, arms procurement, or conventional fraud. Stablecoin rails in West Africa now provide the same frictionless settlement capacity increasingly favored by PRC-linked financiers in Southeast Asia (Sina Finance, May 26). In effect, stablecoins have become a structural enabler of transnational illicit finance tied to PRC nationals, providing cross-border transfer capacities beyond the reach of current regulatory controls.

Weapons Trafficking Completes the Supply Chain

In May, Amnesty International verified the presence of PRC-manufactured weapons in both Khartoum and Darfur, despite a standing United Nations arms embargo on Sudan. The investigation traced the weapons’ path through the UAE, confirming that PRC-manufactured weapons had been re-exported into an active conflict zone (Amnesty International, May 8; SCMP, May 9). The UAE—already identified as a primary destination for smuggled African gold and a key entrepôt for trafficked resources such as timber and wildlife—is now linked to weapons leakage into embargoed territories. A 2023 report by the PRC’s Ministry of Commerce (MOFCOM) highlights the country’s central role as a commodity logistics hub, while international investigations document its function as a distribution point for illicit flows ultimately bound for the PRC (The Sentry, February 2021; GITOC, December 2022; MOFCOM, 2023).

Extractive commodities and arms flows are not separate streams but parts of a single transnational infrastructural system. Gold and timber exports provide the financial base, often routed through opaque networks tied to PRC buyers. Stablecoin rails in West Africa supply frictionless cross-border digital settlement, as increasingly favored by PRC-linked illicit financiers in Southeast Asia (Sina Finance, May 26). The re-export of weapons through commodity hubs completes the circuit, bringing material support back into conflict zones. The convergence is the critical risk: financial, logistical, and military flows run along the same corridors, reinforcing each other and expanding the resilience of militant economies.

This configuration functions as a shadow liquidity system. Value extracted from African resources is continuously re-expressed as kinetic capability, ensuring that liquidity itself becomes a weaponized asset class. Each transaction in this system, whether a gold shipment, stablecoin transfer, or weapons re-export, amplifies the others, producing a feedback loop that stabilizes illicit power structures where governance fails.

Conclusion

The evidence now available establishes that the illicit involvement of PRC nationals in African conflict economies is neither incidental nor peripheral. Judicial convictions in Bukavu and Lagos confirm the presence of criminal actors from the PRC engaged in both extractive laundering and stablecoin-based fraud, while reporting from Sudan illustrates how weapons manufactured in the PRC reappear in embargoed theaters.

These cases reveal a common pattern. Illicit finance and logistics linked to PRC nationals run through the same corridors that sustain militant supply chains. Gold, timber, digital assets, and arms move along overlapping routes, creating a resilient system in which capital and material flows reinforce one another.

Recognizing this convergence is essential. The challenge is not simply weapons leakage or financial opacity in isolation but the way disparate supply chains combine to strengthen insurgent and criminal economies. PRC end-user demand and facilitation give the system scale and durability, tying local extraction and digital laundering directly to global markets. Addressing this challenge requires collapsing the divide between arms embargo enforcement and financial crime intelligence; and treating both as elements of one integrated system.