China has established the World Artificial Intelligence Cooperation Organization (WAICO), a new intergovernmental body with 29 founding members, fundamentally reshaping how the world approaches AI governance and access. Announced on July 16, 2026, at the World Artificial Intelligence Conference in Shanghai, WAICO represents a strategic pivot away from the US-dominated approach to AI development and toward a model emphasizing affordability, sovereignty, and cooperation among Global South nations.

Why Is WAICO Different From How the US Approaches AI?

The emergence of WAICO reflects a stark divergence in how major powers are competing for influence in artificial intelligence. While the United States launched Pax Silica in December 2025, a coalition focused on controlling the physical infrastructure of AI (semiconductors, chips, computing power, and energy), China is taking a different route: building institutional frameworks and offering accessible AI models to the developing world.

The contrast is striking. The US strategy emphasizes full-stack dominance, meaning American companies want to sell complete AI ecosystems from hardware to software. China, by contrast, is releasing open-weight AI models like DeepSeek, Moonshot, and Alibaba's Qwen that anyone can download, modify, and run locally without paying premium licensing fees. This approach appeals directly to countries that want to avoid dependency on either superpower.

"China frames AI safety and governance as the distribution of capabilities among states that do not have them, preventing 'new historical injustice in AI' and ensuring that AI development is not 'a solo performance by a single country, but a symphony of international cooperation.'"

Michael Caster, Head of Global China Program at ARTICLE 19

WAICO's membership tells the story. The 29 founding members include nations from Africa, Asia, Latin America, and the Middle East, but notably exclude all G7 countries. Serbia, a European nation, is among the signatories, signaling that even some developed countries are hedging their bets between US and Chinese approaches.

What Does WAICO Actually Do?

While WAICO is being framed primarily as a governance body, its actual scope extends far beyond setting rules. According to Chinese President Xi Jinping's announcements, the organization will provide AI training and seminars to developing countries, create regional cooperation centers, and deploy AI-powered systems like meteorological warning networks. These are not abstract governance discussions; they are concrete projects that embed Chinese AI infrastructure into partner nations.

The organization functions as an institutionalized container for bilateral AI activities that China was already conducting with Global South countries, but now with formal coordination and political backing. This matters because it signals commitment and creates a standing coalition that can advocate for China's positions in other international forums, including the United Nations.

How Is This Reshaping Global AI Competition?

The global AI landscape is now organized around three competing visions, each with different priorities:

• US Strategy (Pax Silica): Securing the physical foundations of AI through allied nations, controlling semiconductors, critical minerals, and computing infrastructure. By June 2026, Pax Silica had grown to 24 signatories, and the European Union joined in late June, marking a significant shift.
• China's Strategy (WAICO): Building governance institutions and offering affordable, open-source AI models that developing nations can adopt without dependency on Western tech companies or expensive licensing agreements.
• Europe's Strategy: Attempting to participate in Pax Silica while simultaneously building its own technological sovereignty through the AI Continent Action Plan, which mobilized 200 billion euros through its InvestAI initiative, with projected datacentre investment of 176 billion euros by 2031.

This fragmentation is unprecedented. Rather than converging toward a single international framework, the world is moving in the opposite direction, with infrastructure organized through one coalition, governance through another, and technological sovereignty increasingly becoming a national project.

Why Does the Global South Find WAICO Attractive?

At the AI for Good Summit in Geneva in July 2026, a week before WAICO's launch, the contrast between American and Chinese approaches became clear. While American policymakers emphasize security, control, and technological leadership, the Summit foregrounded growth, inclusion, and local agency. Open-source models, modular infrastructure, and interoperable systems were celebrated as key tools for sustainable development around the world.

For developing nations, the appeal of WAICO and China's open-source models is straightforward: affordability and autonomy. Chinese models are free or low-cost, can be run locally on modest hardware, and do not lock countries into dependency on American cloud services or proprietary platforms. This resonates deeply with nations concerned about deepening global inequalities through AI.

"At the Shanghai AI Summit on July 17, President Xi delivered a speech promising to help the Global South 'bridge the AI and digital divides, promote sustainable development, and prevent creating new historical injustice in AI.'"

Stimson Center analysis

The White House's recent decision to block access to Anthropic's advanced Mythos model for foreign nationals, including Anthropic's own employees, has only strengthened this perception. To the rest of the world, such restrictions signal that reliance on American AI infrastructure may be unstable and politically conditional.

What Are the Risks and Uncertainties?

WAICO's long-term impact remains uncertain. While China's rhetoric emphasizes openness and cooperation, experts note that the organization's actual functioning, funding mechanisms, and specific initiatives are still largely unknown. It is unclear whether political announcements will translate into sustained, concrete projects or whether WAICO will become a symbolic gesture with limited practical impact.

There are also legitimate concerns about the quality and safety of Chinese AI models. Studies have found that some leading Chinese models remain more susceptible to jailbreaks and other safety failures compared to Western frontier models. If WAICO encourages more rigorous safety testing and the adoption of robust safety standards across Chinese and other models, it could contribute to a safer global AI ecosystem. However, if it does not, widespread adoption of less-tested models could create new vulnerabilities.

Additionally, WAICO represents what experts call China's "parallel-institution strategy." Rather than trying to dominate existing international forums, China is building alternative institutions that normalize its approaches to AI governance, which member states can then promote in other venues. This gradual normalization of state-centric, sovereignty-focused AI governance could eventually shift international norms away from human rights and internet freedom principles.

How Should Policymakers Respond?

For Europe and the United States, WAICO signals a critical gap in strategy. The world's demand for AI does not currently align with a binary choice between competing national ecosystems. Many stakeholders prefer models that emphasize flexibility, local control, and shared access instead of full-stack imports from either superpower.

American policymakers, in particular, face a challenge. If the US wants to lead globally in AI, it needs to better understand and tailor offerings to the preferences of the rest of the world, which increasingly prioritize openness, affordability, and sovereignty. The current US strategy of exporting proprietary, full-stack frontier AI may appeal to wealthy allies but risks ceding influence in the Global South to China.

Europe's position is equally precarious. By joining Pax Silica while simultaneously pursuing its own technological sovereignty, the EU is attempting a delicate balancing act. Whether other coalition members will tolerate this dual position over time remains an open question.

The stakes are high. The impending moves by the US, Europe, and China will not necessarily determine who leads the AI era, but they will determine whether the world still agrees on the rules of the game. A single international institution capable of coordinating technological development and governance, built on shared principles and mutually accepted limits, would not eliminate strategic competition. But competition inside a shared framework is fundamentally different from competition between rival ones.