America’s “AI Ultimatum” Fuels Rivalry With China, Making the World More Divided
Kazakhstan’s dual membership in Pax Silica and WAICO highlights the growing pressure on nations caught between U.S. and China in the AI race.
READ IN APP Representatives of the “Pax Silica” signatories hold signed documents at a summit held in Washington on December 12, 2025. Photo source: AFP
The United States is preparing to tell dozens of countries they must pick sides in the red‑hot Artificial Intelligence (AI) race with China, warning that they will be excluded from the U.S.-led Pax Silica coalition if they also sign up for Beijing’s competing framework, the World AI Cooperation Organization (WAICO).
Washington’s latest move, revealed in internal drafts and confirmed by U.S. officials, underscores how quickly tensions are escalating in the AI domain — less than two months before Chinese President Xi Jinping’s highly anticipated visit to Washington in late September and ahead of the first round of bilateral AI dialogue under the Trump 2.0 administration.
The upcoming bilateral AI dialogue was one of the outcomes of President Donald Trump’s May visit to Beijing, as both sides recognized the growing risks of AI, especially regarding safety and security. However, in recent months, both sides have felt the gap was too wide in terms of priorities and expectations for negotiations over a series of AI and technology policy issues.
“To be part of everything is to be part of nothing. Signature of the Pax Silica Declaration is not merely a membership subscription, but a commitment,” Reuters quoted the internal letter to Pax Silica members as saying, urging countries to choose deliberately on AI.
Pax Silica, launched by the United States in late 2025, is a coalition of about two dozen allied economies plus the EU, focused on securing AI supply chains and promoting pro‑innovation governance. Taiwan endorsed its principles through a joint statement with Washington. By contrast, the World AI Cooperation Organization (WAICO), unveiled in Shanghai in July 2026 under China’s leadership, brings together nearly 30 founding members from the Global South and aims to position itself as an international body for inclusive AI governance.
Notably, Kazakhstan is the only country that has joined both Pax Silica and WAICO, reflecting its strategy of balancing between U.S. and Chinese frameworks in the emerging bifurcated AI order.
Washington’s latest warning to many of its allies reflects growing anxiety about China’s rapid progress in AI, particularly after the launch of models like DeepSeek and Kimi K3, which have demonstrated technical breakthroughs at lower costs than leading U.S. systems. For policymakers in Washington, these advances challenge the assumption that America can indefinitely maintain a generational lead. The U.S. response has been to tighten export controls, restrict access to advanced chips, and now pressure allies to align exclusively with Pax Silica.
Competing Visions of AI
At the heart of this confrontation lies a fundamental difference in how the two powers conceptualize AI. China frames AI as a “public good” — a tool to be shared, distributed, and leveraged for development across the Global South. Xi’s speech at the World AI Conference (WAIC) in Shanghai emphasized inclusivity, portraying WAICO as a mechanism to democratize access to AI infrastructure and governance.
By contrast, the U.S. treats AI as a scarce strategic commodity — something to be controlled, regulated, and distributed selectively to preserve its competitive edge. Washington’s insistence on restricting Chinese models and forcing allies to choose sides reflects this scarcity mindset.
The clash of values is stark: one side emphasizes openness and shared economic benefits, the other prioritizes exclusivity and tight control of critical technology.
As China revealed its plan to launch WAICO earlier this year, I was among the first to share my views in the press comparing Pax Silica and WAICO, and unfortunately my concerns have been borne out.
The world is rapidly dividing into two AI camps: one led by Washington, the other by Beijing. The risk of a new “AI cold war” is rising, with rival blocs developing separate ecosystems, standards, and supply chains. I shared such worries and made a prediction of this alarming trend in my October 2024 op‑ed in Nikkei Asia.
This bifurcation is not merely theoretical. Kazakhstan is now in the spotlight as the only country that has joined both Pax Silica and WAICO, highlighting the dilemma faced by middle powers. For Kazakhstan, dual membership reflects a balancing act — but Washington’s ultimatum may force it to choose, undermining its bridge role. Other countries should take note: the pressure to align exclusively with one camp is intensifying.
For example, Singapore illustrates the complexity of this moment. The city‑state is a member of Pax Silica, but its foreign ministry has repeatedly emphasized that it does not want to be forced into choosing sides between the U.S. and China. Singapore hosts numerous Chinese tech investments and regional headquarters, making it impossible to comply with a possible U.S. ban on Chinese AI models without undermining its own economic ecosystem.
Singapore’s participation in Pax Silica is framed as pragmatic and interest‑driven, not geopolitical alignment. It seeks supply chain security and trusted partner status, but it also maintains deep economic ties with China. Washington’s demand that members take sides runs directly against Singapore’s long‑standing commitment to neutrality and balance.
Mongolia is not a member of Pax Silica or WAICO, but sources say it is exploring how to be affiliated with both, if not to join as a full member of each. Washington’s new warning will complicate Mongolia’s situation.
Mongolia is already a founding member of President Trump’s “Board of Peace”, launched on January 22 this year during the World Economic Forum in Davos, Switzerland.
Zero‑Sum Mindset and Decoupling
Meanwhile, China is actively working to expand WAICO’s membership from around 30 founding states to 40–50 countries, sources say. China’s ambition is to transform WAICO into a formal international organization, akin to the Beijing‑headquartered Asian Infrastructure Investment Bank (AIIB), rather than just another Chinese‑led initiative.
Making WAICO an international organization would allow it — with headquarters in Shanghai, China’s business capital — to speak for the Global South on platforms like the United Nations.
The UN has already signaled support: Secretary‑General António Guterres attended WAICO’s launch ceremony in Shanghai in July, lending legitimacy to the organization. This creates another point of friction between Washington and the UN system, which the Trump administration has long been dissatisfied with for various reasons.
By forcing Pax Silica members to choose sides, the U.S. risks putting its foreign policy at odds not only with China but also with multilateral institutions that see value in WAICO’s inclusive framing.
America’s latest “AI ultimatum” also creates a new dilemma for European powers. The UK, France, and Germany have adopted a more cooperative attitude toward China on AI. They sent experts to Shanghai to participate in WAIC and joined closed‑door sessions, signaling willingness to engage even if they are not ready to join WAICO formally.
Washington’s demand that Pax Silica members take sides places these countries in a difficult position. Politically, major European powers like the UK, France, and Germany are unlikely to sign up for WAICO anytime soon, but they also cannot afford to sever ties with China on AI cooperation. Europe’s approach is pragmatic: engage with both sides, hedge risks, and preserve autonomy. Forcing a binary choice risks alienating allies and undermining transatlantic unity.
Washington’s latest warning reflects a zero‑sum ideology: the belief that any gain for China must be a loss for the U.S. In the long run, this mindset points toward a fundamental desire to decouple from China in the technological domain, especially in AI.
But decoupling carries enormous risks. It undermines trust, accelerates fragmentation, and creates uncertainty for global innovation. For allies, it poses dilemmas: comply with Washington and lose access to Chinese markets, or resist and risk exclusion from U.S.-led frameworks. For the broader international community, it signals that cooperation is being sacrificed at the altar of rivalry.
All of this adds more uncertainty to Xi’s planned visit to Washington in late September. The visit was supposed to be an opportunity to stabilize relations and launch the first round of bilateral AI dialogue under the Trump administration. Instead, Washington’s ultimatum risks poisoning the atmosphere, making cooperation harder and mistrust deeper.
If the U.S. insists on forcing allies to choose sides, it will not only complicate Xi’s visit but also undermine the credibility of the dialogue itself. Cooperation on AI safety, governance, and standards requires trust and inclusivity. A zero‑sum approach makes that impossible.
The U.S. warning to Pax Silica members is a turning point. It reflects Washington’s anxiety about China’s rapid AI progress, its scarcity mindset, and its desire to preserve dominance. But it also risks alienating allies, undermining multilateral institutions, and accelerating division.
China, meanwhile, is expanding WAICO, framing AI as a public good, and positioning itself as the voice of the Global South.
Unless the U.S. and China can sit down to talk and consider cooperation, the world risks sliding into an AI cold war — a scenario that would undermine innovation, governance, and global stability.
Appendix: Who’s who in the Washington vs. Beijing camps
Pax Silica Member Countries (U.S.-led)
Launched in December 2025, Pax Silica focuses on AI supply chain security and pro‑innovation governance. Members / Signatories (as of June 2026):
Americas: Argentina, Chile, Costa Rica, El Salvador, Panama, Paraguay, United States
Europe: Denmark, Estonia, Finland, Germany, Greece, Italy, Latvia, Lithuania, Netherlands, Norway, Poland, Portugal, Sweden, United Kingdom, European Union
Middle East: Bahrain, Qatar, United Arab Emirates
Asia-Pacific: Armenia, Australia, India, Israel, Japan, Kazakhstan, Republic of Korea, New Zealand, Philippines, Singapore, Turkiye
Taiwan: Endorsed Pax Silica principles via a joint statement with the U.S.
WAICO Member Countries (China-led)
The World AI Cooperation Organization (WAICO) was established in Shanghai in July 2026 during WAIC. Founding Members include:
Asia: China, Cambodia, Indonesia, Iran, Kazakhstan, Kyrgyzstan, Laos, Malaysia, Myanmar, Oman, Pakistan, Tajikistan, Uzbekistan
Europe: Russia, Belarus, Serbia
Africa: Algeria, Cameroon, Congo, Ethiopia, Kenya, Lesotho, Mozambique, Senegal, South Africa, Zambia
Latin America: Brazil, Cuba, Nicaragua, Venezuela