As the US and China form AI blocs, countries are increasingly torn
between them
[October 26, 2026] By
CHAN HO-HIM and DIDI TANG
HONG KONG (AP) — With the two leading AI powers, the United States and
China, forming their own AI blocs, other countries are maneuvering to
harness the strengths of both groupings and avoid losing out.
As the rivalry intensifies, experts say the window for countries to be
able to choose freely between the two AI superpowers may be narrowing,
forcing them to at one point pick between the U.S.-led Pax Silica and
the China-inspired World AI Cooperation Organization.
That could put many countries in a dilemma: Do they go with the U.S.’s
most advanced chips and AI technologies, or join China’s more
affordable, open-source AI systems?
Kazakhstan, a Central Asian nation of about 21 million people, is a rare
example of a country that has sought to bridge that gap.
Just three weeks after its AI minister Zhaslan Madiyev visited
Washington in June to join the U.S. group working to strengthen AI
supply chains, he headed to Shanghai for a signing ceremony making the
Central Asian country a founding member of China's initiative to shape
the global AI agenda.
Being in Pax Silica means more technological partnerships, high-tech
manufacturing jobs and a place in global AI supply chains. At the same
time, as part of China’s World AI Cooperation Organization alongside 28
other initial founding countries including Pakistan and Russia,
Kazakhstan hopes to also have a voice in setting regional and global AI
standards.
“Everyone is hedging,” said Dana Masalimova, a former Kazakhstan
diplomat and independent scholar and center associate at the Kathryn W.
and Shelby Cullom Davis Center for Russian and Eurasian Studies at
Harvard University.
“We don’t want this binary choice,” she said.
Kazakhstan among countries hoping to harness the best of both blocs
Kazakhstan is benefiting from both U.S. and Chinese investments, but is
in a “very precarious spot,” Masalimova said.
It has rich critical mineral resources essential to AI development and
has cheap electricity to power data centers, which have become
politically fraught in the U.S.
Earlier this year, Kazakhstan's government signed an investment deal
worth up to $10 billion involving Nvidia to build a “data center valley”
in the country.
Meanwhile, more Chinese companies are investing in Kazakhstan. Local
officials say Chinese foreign direct investment in Kazakhstan reached a
record $2.8 billion in 2025. Chinese leader Xi Jinping met with Kazakh
President Kassym-Jomart Tokayev in July to expand cooperation under
China’s global infrastructure building Belt and Road initiative.
Washington’s pressure campaign versus Beijing’s courtship
Both China and the U.S. are leveraging access to AI to increase their
global influence.
President Donald Trump insisted last month that “whoever wins AI, wins.”
U.S. officials and AI companies have accused China of large-scale
“distillation,” or extraction of capabilities, from frontier American
models.
Beijing has rejected those claims and says the U.S. is pursuing an AI
monopoly while restricting China’s access to some of the world’s most
cutting-edge AI chips and chipmaking machinery.
Washington has signaled that Pax Silica — with China as its implicit
target — is only for the trusted.
“Countries can’t be trusted partners in Pax Silica while substantively
engaging in initiatives that advance a competing vision for super
intelligence,” the U.S. State Department said, using the Trump
administration’s new preferred term for AI.
For its part, Beijing touts the openness and inclusiveness of its World
AI Cooperation Organization. “As both major countries in AI, China and
the United States should leverage respective strengths in AI rather than
guarding against each other,” the Chinese embassy in Washington said in
a statement. “AI should not be owned by major countries.”
The two AI powers have different messaging largely because Beijing needs
to court third countries in its bid to build an alternative coalition,
whereas Washington already has a powerful network of allies, said Kyle
Chan, a fellow at The Brookings Institution’s John L. Thornton China
Center.
That lends power to what he described as “swing countries.”
[to top of second column] |
Chinese President Xi Jinping, center right, Kazakh President
Kassym-Jomart Tokayev, center left, and other leaders pose for a
group photo with other attendees before the opening ceremony for the
World AI Conference in Shanghai, July 17, 2026. (AP Photo/Ng Han
Guan, Pool, File)
 Indonesia, Singapore may also be
caught between China and the US
Like Kazakhstan, Indonesia has resources vital for AI and other
technologies, such as nickel and copper. It's also seeking to make
the most of both AI powers, having joined China's World AI
Cooperation Organization.
Indonesia wants to benefit from both, Mari Pangestu, the Indonesian
National Economic Council's vice chair, told reporters at a
University of Hong Kong Business School event. “We should be able to
be part of both, put it that way. And choose the best system.”
U.S. AI firms are bringing investments to other countries like
Singapore, where Anthropic is setting up its latest Asia office. The
city-state says it is also considering joining China’s AI
organization.
In Saudi Arabia, the AI startup Humain unveiled in September a
platform built on an open model by a Chinese AI company. The kingdom
also has a deal with Nvidia to expand AI computing with its advanced
chips.
France, one of the most ambitious AI developers aside from the U.S.
and China, is attempting to go its own way with its startup Mistral,
whose new model released this month outperforms some advanced
Chinese models.
Japan is closely aligned with the U.S. on strategic and security
issues, including advanced semiconductors, trusted AI and standards.
But it will not reject the more affordable Chinese AI models for
“lower-risk applications,” said Takahiro Tsuchiya, a professor at
Kyoto's University of Foreign Studies.
Difficult to challenge the 2 leading powers
For countries like the U.K. and Germany, which have substantial
economic and military capacity but no self-developed powerful
frontier AI models of their own, aligning with the U.S. may be vital
for their access to data centers and chip deals with U.S. companies,
said Anton Leicht and Sam Winter-Levy at the Carnegie Endowment for
International Peace.
Essentially, their access to advanced AI systems “depends on the
whims of policymakers in Washington and Beijing,” they said, while
those countries may have limited influence over AI’s future.
China, meanwhile, has been closing the technology gap with the U.S.
when it comes to chipmaking and advanced AI capabilities, but it
still trails top U.S. technological capabilities, at least for now.
Also, Beijing's open-source approach allows countries to be less
reliant on the U.S., and China has been providing funding for
developing countries to develop their own AI ecosystems, said
Alberto Lemma, a research fellow at the think tank ODI Global.
To date, China has provided official sector grants and loans for
projects and activities that use or enable AI technologies in at
least 77 low- and middle-income countries, according to the AidData
research lab at William & Mary, a public university in Virginia.
Some top recipients include Nigeria, Zambia, Ghana, Bangladesh,
Senegal, Cameroon and Kenya. Public perceptions are also changing.
Recent study results from Pew Research Center have shown that people
in middle-income countries are becoming more positive and trusting
of China when it comes to AI and the technology’s regulation.
All things considered, many countries “don’t want to pick a side ...
because there are advantages and disadvantages to each technology
stack,” said Aalok Mehta, director of the Wadhwani AI Center at the
Center for Strategic and International Studies.
Most countries may eventually lack a good option since they cannot
compete on building AI frontier models, but “every country in the
world in some way or another is thinking about AI sovereignty," he
said. After all, “maybe no other country than the U.S. and China can
really build these very large, powerful models.”
___
Tang reported from Washington.
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