The US government intends to cut countries off from its AI supply chain initiative if they participate in a rival organisation established by China, according to Reuters.

The newswire reported that the US government has drafted a letter to 35 countries, all of which have expressed interest in working with the US on securing AI supply chains, not to sign up to China’s World Artificial Intelligence Cooperation Organization (WAICO) on pain of being banned from collaborating with the US.

Reuters added it has seen the draft letter and had its legitimacy confirmed by a US official. Those who join will be banned from the US’s Pax Silica effort, which would amount to being shut out from potential infrastructure investments and supply chain agreements.

The US established Pax Silica in December 2025 as an initiative for collaboration on securing the strategic supply chains necessary for AI including software, compute, semiconductors, advanced manufacturing, logistics, and energy.

It is understood to directly rival efforts by China to shore up its access to the critical supply chains necessary to compete with the US in AI dominance.

When pressed on the matter by Reuters the State Department declined to comment on what it called “purportedly leaked internal documents”.

The first countries to sign the Pax Silica declaration were Australia, Israel, Japan, South Korea, Singapore, the United Kingdom, and the United States. It has since grown to 24 members, including the European Union and India.

Taiwan, which plays a critical role in the AI and semiconductor industries, has participated in Pax Silica discussions with the US State Department but is not yet a signatory. Taiwan Semiconductor Manufacturing Company (TSMC) produces around 90 per cent of the world’s advanced semiconductors, according to the US Department of Commerce.

Current WAICO participants include Brazil, China, Indonesia, Iran, Oman, Pakistan, and Russia.

The only country that is currently a member of both initiatives is Kazakhstan, which plays a critical role for China as its primary overland transport route into Europe and Central Asia. It also has significant rare earth mineral reserves, important for the manufacturing of semiconductors and other physical AI infrastructure.

Unlike Pax Silica, WAICO also includes significant uptake from African nations, such as the Democratic Republic of Congo, Ethiopia, Kenya, and South Africa. The initiative also includes approximately half of Southeast Asia and two South American countries, Brazil and Venezuela.

This gives China an international foothold for AI, in line with its Belt and Road initiative for infrastructure and economic development.

---