The US State Department has drafted a letter making hardware access — rather than diplomatic language — the practical consequence for countries seeking to belong simultaneously to Washington's and Beijing's competing artificial intelligence frameworks. Reuters reported on August 14 that the letter, which has also been confirmed by several independent outlets, is addressed to the 35 countries that signed a US "AI Opportunity Statement" at the Second Pax Silica Summit in Washington in June 2026. Its message is clear: countries cannot retain Pax Silica membership — and the associated access to coordinated chip investment, joint export-control alignment and shared AI infrastructure projects — while also joining the World Artificial Intelligence Cooperation Organization (WAICO), the China-backed governance body founded in Shanghai on July 16, 2026, when 29 countries signed the WAICO agreement.

The State Department declined to comment on what it described as "purportedly leaked internal documents". The letter is undated, and it remains unclear whether it will be sent in its current form. Its significance lies less in its diplomatic wording than in the tool it seeks to use: under Pax Silica's structure, membership provides practical access to critical chokepoints in the global chip supply chain. Countries denied that access would face an ongoing dependency rather than a one-off sanction. Advanced AI accelerators deteriorate and need to be replaced every few years, allowing the US to retain a continuing source of pressure by controlling access to the next generation of chips, as analysts examining Pax Silica's enforcement architecture have noted.

"To be part of everything is to be part of nothing," the draft letter says. "Signature of the Pax Silica Declaration is not merely a membership subscription, but a commitment." It urges signatories to "choose deliberately", but does not state what would happen if they refused to choose — and does not mention China by name.

What Pax Silica membership provides — and what losing it could mean

Pax Silica, launched by Under Secretary of State Jacob Helberg in December 2025 and outlined on the State Department's initiative page, is not a conventional trade agreement. It seeks to manage the entire AI technology chain — from rare-earth extraction and semiconductor manufacturing to the deployment of frontier models — as a single, integrated security system. By June 2026, the initiative had 24 formal signatories, including the EU, Germany, the Netherlands, Japan, South Korea, India and the UAE, according to Pax Silica's membership record. The Netherlands is home to ASML, the only manufacturer of extreme ultraviolet lithography machines, which are essential for producing leading-edge chips.

Members gain access to joint investment opportunities in AI projects, coordinated export controls and a framework for cooperation on chip manufacturing, critical-minerals processing, data-centre infrastructure and AI model development. The practical impact of membership — and of exclusion — is tied to access to chips. ASML's EUV machines are vital for producing the advanced processors that power frontier AI systems. The machines are made in the Netherlands, an original Pax Silica partner, while the plants that use them are concentrated in Taiwan, South Korea and the US. Taiwan is not a formal signatory but has endorsed Pax Silica principles. A country that loses its standing in Pax Silica would not merely disappear from a membership list; it would be excluded from the coordination system that helps determine who receives priority when the next generation of AI accelerators reaches the market.

During an appearance at the Hudson Institute in January 2026, Helberg described AI supply-chain security as inseparable from national security, covering energy, minerals, manufacturing and AI infrastructure as a single policy agenda. Analysts at the Atlantic Council have said that Pax Silica needs clarity on the consequences of violations by members if it is to function as a credible framework. The draft letter does not yet provide that clarity.

Kazakhstan: where the two blocs meet over mineral reserves

Kazakhstan is the country that prompted the draft letter and is currently the only confirmed member of both frameworks. Much of Kazakhstan's uranium production is contracted to China and Russia, while the country also has substantial reserves of tungsten, copper and rare-earth elements, making its mineral wealth strategically important to both blocs. Helberg publicly welcomed Kazakhstan's accession to Pax Silica at the second summit in June 2026, making it the first Central Asian country to join. Its admission was strategically logical: Kazakhstan has significant reserves of the critical minerals on which advanced chip production depends and which Pax Silica was created to secure.

Within weeks of joining Pax Silica, Kazakhstan also signed WAICO's founding agreement. A US official told Reuters, speaking anonymously, that the letter was intended to make clear that "you can't have it both ways". The official said it was "difficult to see how a country can credibly position themselves as trusted partners in one technology ecosystem while simultaneously signing up for an initiative designed by China to advance a competing vision for AI".

Kazakhstan's ability to balance between the blocs reflects leverage that most Pax Silica signatories lack. Its mineral wealth and position along major Eurasian transport routes give both sides reasons to accommodate it rather than lose it. China has already shown that it is prepared to use near-monopolies in minerals for political purposes, restricting rare-earth magnet exports in 2025 in response to US tariff measures. A mineral supplier maintaining ties with both blocs is precisely the scenario Pax Silica was intended to prevent.

At the country level, analysts point to different forms of cross-bloc engagement in Kazakhstan, Pakistan and Kenya. Pakistan has expanded AI cooperation with China through CPEC 2.0 while also signing a $500 million rare-earth partnership with the US. Kenya is a founding WAICO member, hosts a Microsoft-G42 data centre and cooperates with Huawei on training public officials. The broad picture of two clearly separated camps becomes a more complicated map of overlapping alignments when examined country by country.

What WAICO is — and why Washington says the two frameworks cannot coexist

WAICO, the World Artificial Intelligence Cooperation Organization, was established by 29 founding countries on July 16, 2026, at the Shanghai World Expo Exhibition and Convention Center. Chinese Foreign Minister Wang Yi signed the agreement on behalf of China. Headquartered in Shanghai, WAICO operates according to principles that conflict directly with Pax Silica's structure: it allows open participation without a values or regime-type test, promotes Chinese open-weight AI models as an alternative to the US-led computing stack, and advances an ethics framework based on Chinese standards rather than the OECD AI Principles, the EU AI Act or the G7 Hiroshima Process.

That structural conflict underpins the US position. Pax Silica focuses on the physical AI stack — minerals, chips, computing and infrastructure — using shared investment and coordinated export controls to create alignment. WAICO focuses on norms and standards, establishing a regulatory philosophy that will shape AI law in its 29 member states. A country that aligns domestic AI regulation with WAICO's standards would be developing a legal framework that does not have to comply with the EU AI Act. Operating legally in markets governed by the other framework could then require costly redesign of AI systems. Once that regulatory alignment is established, reversing it would require new legislation and reorganised regulatory agencies, according to analysts who have examined the divide between WAICO and Pax Silica.

The difference between the two frameworks extends beyond governance. WAICO's members include Russia, Cuba, Venezuela, Belarus and Serbia — all countries subject to US sanctions regimes — alongside developing economies in Africa and Asia. Some joined because WAICO imposes no values test and offers Chinese AI training and access to open-source models at no cost. When Xi Jinping launched WAICO at WAIC 2026, he pledged 5,000 AI training opportunities for developing countries over five years. That commitment turns governance alignment into technology adoption, and technology adoption into lasting regulatory alignment.

Does the ultimatum have teeth? The draft's enforcement gap

The letter's main structural weakness is the same one analysts identified in Pax Silica's founding declaration in December 2025: it avoids specifying adversaries, chokepoints or enforcement mechanisms. The draft does not name China, set a deadline or identify a penalty for countries that decline to choose. Nor does it establish a process for determining whether a country's other memberships "conflict with our expectations".

If Washington decides to enforce the demand, the main instrument would be the dependence on chip access built into Pax Silica. AI accelerators are not permanent assets. They deteriorate and generally need to be replaced every two to four years. A country that builds its AI computing infrastructure around Nvidia-related hardware sourced through Pax Silica-aligned channels would face a recurring dependency each time replacement is needed. Restricting access to future generations of chips through changes to Bureau of Industry and Security export controls would be the practical lever — not expulsion from a diplomatic club. Analysts have described this as Pax Silica's chip kill switch.

The mechanism has already been demonstrated. The UAE's G42 began removing Huawei hardware from its infrastructure as a condition of joining Pax Silica, followed by the US decision to place the UAE in Country Group A:5 for chip-export purposes.

However, using that lever against Kazakhstan could impose costs that Washington may not be prepared to accept. The US wants Kazakhstan in Pax Silica precisely because of its mineral reserves. Removing it to punish its WAICO membership would undermine the supply-chain diversification the initiative was designed to deliver. China analyst Rui Ma offered the sharpest version of this criticism, arguing that the letter could cost more than it achieves. In her view, the world could see one side weaponising supply chains and controlled access while the other promotes open technology and broad access; alliances are not permanent, and incentives change.

The draft's instruction to "choose deliberately" is therefore aspirational rather than operational. Whether it becomes an enforceable requirement will depend on decisions that Washington has not yet made.

What the 35 countries are being asked to decide

The 35 signatories of the AI Opportunity Statement represent a broader and less tightly defined group than the 24 formal signatories to Pax Silica's declaration. They signed a document expressing "common purpose" and a "shared vision" with the US — a symbolic commitment rather than an operational one. The draft letter seeks to turn that symbolic commitment retroactively into an exclusivity requirement, as reports on the letter's scope have shown.

The calculation is not the same for all 35 countries. States with irreplaceable positions in the chip supply chain — including the Netherlands, home to ASML; South Korea, where Samsung and SK Hynix are based; and Japan, a supplier of chip-grade chemicals and advanced materials — have structural reasons to remain firmly within Pax Silica regardless of the letter. Countries whose main contribution is critical minerals or geographical position, including Kazakhstan and potentially others in the Global South, have greater room to resist.

Singapore, a founding Pax Silica member, has repeatedly stressed that it does not want to be forced to choose between the US and China, given the depth of Chinese technology investment in its economy, according to analysts tracking the bloc dynamics.

The letter does not disclose the full list of 35 signatories. Until those names are made public, it is impossible for outside observers to fully determine who is being asked to choose — and whose decision will matter most.

Frequently Asked Questions

What is Pax Silica, and what does a country gain or lose by joining?

Pax Silica is a US State Department-led initiative launched in December 2025. It treats the entire AI technology chain — from rare-earth extraction and semiconductor manufacturing to deployment of frontier AI models — as a single integrated security system to be coordinated among "trusted partner" countries. Members gain access to joint investment opportunities in AI projects, coordinated export-control policies and priority access to chip supply chains anchored by ASML's EUV lithography machines in the Netherlands, TSMC's manufacturing capacity in Taiwan and the broader US-aligned semiconductor ecosystem. Losing Pax Silica standing means losing that coordination priority and facing uncertainty during each chip-replacement cycle, typically every two to four years, over whether the next generation of AI accelerators will be available through Pax Silica-aligned channels. Analysts have examined this in detail as Pax Silica's enforcement architecture.

Why is Kazakhstan the flashpoint, and what leverage does it have?

Kazakhstan has significant reserves of rare-earth elements, tungsten, copper and uranium — critical minerals needed for advanced semiconductor manufacturing, according to analysis of the country's accession. China has used its near-monopoly over rare-earth processing, which accounts for approximately 90% of global output, as a trade-reprisals instrument. That makes alternative suppliers such as Kazakhstan strategically important to Western supply-chain security efforts. Kazakhstan's leverage comes from this importance: expelling it from Pax Silica because it joined WAICO would weaken the mineral-supply diversification that Pax Silica was intended to achieve. Its position in Eurasia further strengthens that leverage, giving both blocs reasons to accommodate it rather than force a break.

Can countries belong to both Pax Silica and WAICO, or does the US ultimatum make that impossible?

At present, Kazakhstan has held both memberships simultaneously without any confirmed US response. The draft letter would establish that dual membership is incompatible with Pax Silica standing, but it has not been sent and identifies no enforcement penalty. If Washington decides to act, the practical instrument would be restrictions on chip access through BIS export-control changes, rather than a formal expulsion procedure. Countries deeply embedded in Pax Silica's supply chain — including chip manufacturers, EUV suppliers and advanced-materials producers — have strong incentives to avoid dual membership. Countries whose main contribution is mineral resources or geographical position have more room to balance between the blocs. The draft letter does not resolve that imbalance, as reporting on its scope has confirmed.

What could full separation of the two blocs mean for technology companies?

Countries that align domestic AI regulation with WAICO standards will develop laws that do not need to comply with the EU AI Act, the OECD AI Principles or the G7 Hiroshima Process guidelines, according to analysts following the governance split. For companies deploying AI systems across several jurisdictions, this could mean that products designed to meet one regulatory standard require costly architectural changes before they can operate legally in markets governed by the other. The institutional effects would be lasting. Once a government reorganises its regulatory agencies around WAICO standards, reversing course requires new legislation. Companies making AI procurement and deployment decisions now — particularly decisions on computing infrastructure in WAICO-member markets — could therefore shape their compliance exposure for years.

Originally published on Tech Times