Pax Silica And The AI Schoolyard: Is There Any Room Left For Neutrality?

The AI race has been framed by many as a battle between major companies – OpenAI versus Anthropic, Google versus Microsoft and Nvidia against, well, everybody else.

These days, however, it’s starting to look a whole lot less like a corporate competition and more like a geopolitical one. That’s where Pax Silica comes in.

Aside from having a name that sounds like it was invented by Jack Bauer or the writers from “Homeland”, Pax Silica is quickly becoming one of the most important developments in global technology policy.

At its core, Pax Silica is, in theory, an attempt to build a trusted network of countries that can cooperate on everything the AI industry needs to function, from semiconductors and data centres to critical minerals and energy infrastructure. According to the US State Department, the initiative is designed to create secure technology supply chains among “trusted partners” and reduce dependence on potentially unreliable suppliers. Otherwise translated to, remove dependence on China.

The name itself reveals most of what you need to know the agreement. “Pax” is Latin for “peace” or “stability”. Pax Romana was the peace imposed by Rome, and Pax Americana described the post-war international order led by the United States. Thus, it follows that “Pax Silica” suggests a future world order built around silicon, chips and AI infrastructure – and supposedly, a peaceful one at that.

Whether that’s reassuring or slightly ominous depends on where you’re sitting.

So What Exactly Is Pax Silica?

Launched by the United States in late 2025, Pax Silica brings together countries that are willing to cooperate on advanced technologies, semiconductors, AI systems, critical minerals, manufacturing and the infrastructure that supports them. The goal of the project is for the US to achieve resilience of sorts, ensuring that key AI supply chains remain secure, trusted and less vulnerable to geopolitical disruption.

Officially, the initiative is framed as positive-sum cooperation. But unofficially, it’s impossible to ignore the fact that it emerged amid growing competition between Washington and Beijing over AI leadership, in the midst of Donald Trump’s presidency.

After all, AI isn’t just software – it’s completely dependent on things like chips, energy, minerals, manufacturing capacity and data infrastructure. So, whoever controls those building blocks holds enormous influence over the future of the technology.

What’s the Beef with China?

While Pax Silica rarely names China directly, China is, for all intents and purposes, the elephant in the room. For years, the United States has been attempting to reduce reliance on Chinese supply chains in strategic industries, while China has accelerated efforts to become self-sufficient in advanced technology while expanding its own influence across the global AI ecosystem.

But now, that rivalry has reached but is beginning to feel like a breaking point, where both sides are attempting to build their own spheres of influence in a race to the top.

That became particularly clear this month when reports emerged that Washington is preparing to tell partner nations they may need to choose between participation in Pax Silica and China’s rival AI cooperation framework. According to Reuters, countries that attempt to belong fully to both camps could face exclusion from future US cooperation. In other words, the AI schoolyard may be entering its “pick a side” phase.

It’s Getting a Little Awkward for Everyone Else

This is where things become complicated. The world’s technology ecosystem has never neatly divided into American and Chinese camps – most countries trade with both, it’s just kind of how competitive global markets work. Of course, most governments would prefer not to choose at all.

For countries like India, the UAE, South Africa, Brazil, Indonesia or Saudi Arabia, neutrality has often been an attractive strategy, and it’s not hard to see why. They can benefit from Chinese manufacturing relationships while attracting Western investment and technology partnerships. Why risk alienating one party if it’s not totally necessary?

But now, Pax Silica potentially makes that balancing act much harder. A nation joining the US-led framework may gain access to investment, technology partnerships and preferred supply chains. But, it’s not all rainbows and butterflies.

Siding with Uncle Sam could also risk straining relationships with China, which remains a critical trade partner for much of the world. Conversely, countries that lean too heavily towards Beijing may find themselves excluded from certain Western technology initiatives.

It’s a dilemma that sounds familiar because we’ve seen versions of it before with telecoms infrastructure, semiconductor exports and energy security.

The difference in this case, however, is that AI touches almost every sector simultaneously, and we’re expecting it to become an increasingly integral component of the global technological landscape in future.

But, What About Startups?

For startups, the situation is potentially even more confusing – they’re the little guys, after all. It almost makes me think of children in a divorce having to pick mom or dad.

In many respects, there is some natural alignment. For instance, a startup in Silicon Valley will likely find itself naturally aligned with Pax Silica ecosystems, funding networks and infrastructure. Meanwhile, a startup in Singapore, Kenya, South Africa or the UAE may not have that luxury.

Now, imagine a company building AI products using American foundation models, Chinese hardware components, European cloud infrastructure and Middle Eastern investment capital. Until recently, that would have been viewed as globalisation, but now, given the changing geopolitical situation, this may starting being viewed as strategic ambiguity and even a potential point of weakness.

Ultimately, the concern is that startups could become collateral damage in a competition they never asked to join. If standards, regulations and supply chains start splitting into rival blocs, young companies may have to make difficult choices about which technologies they build on, which markets they serve and which investors they accept. And if they do that, they will, most likely, have to give some things up in order to have others.

Can Neutrality Survive?

So the big question that so many people are asking now is, is neutrality even an option anymore? Historically, many countries have successfully navigated competition between great powers without formally choosing sides. Indeed, during the Cold War, non-aligned nations attempted exactly that, and many (mostly) succeeded.

But in the world of AI, that may prove more difficult. Unlike traditional trade relationships, AI ecosystems are deeply interconnected. Chips depend on minerals, models depend on chips, applications depend on models and data centres depend on energy. Every layer influences every other layer, and attempting to make them all mutually exclusive is a big ask.

So, once countries begin aligning infrastructure, standards and supply chains, genuine neutrality becomes harder to maintain.

That doesn’t necessarily mean a binary world is inevitable. In fact, many governments will continue trying to hedge their bets, maintaining relationships with both Washington and Beijing wherever possible. In fact, some may even emerge as bridges between competing ecosystems, playing the role of “peacekeepers”. But either way, the pressure is clearly building.

The Bigger Risk for Those Caught In the Middle

The greatest risk isn’t necessarily that countries choose sides, it’s that they lose the ability not to.

Pax Silica reflects a broader shift in how governments view technology: AI is no longer just an industry. Now, it’s becoming something that’s treated as critical infrastructure, economic strategy and national security rolled into one.

For businesses, startups and governments that hoped to stay above the fray and out of the controversy, that may be the most significant development of all. There’s simply nowhere left to hide.

The AI race was once about building better technology, but now, it’s becoming about building competing worlds around that technology. And as any child knows, schoolyards tend to become much less fun once everyone starts picking teams.