The global AI landscape is increasingly shaped by two competing world orders: Washington’s Pax Silica and Beijing’s World Artificial Intelligence Cooperation Organization (WAICO). The two initiatives reflect sharply different visions of how power, technology and access to critical AI infrastruct ure should be organized. Pax Silica, which the U.S. launched in December 2025, purportedly seeks to secure global supply chains for semiconductors and semiconductor manufacturing equipment, AI technologies and rare earth minerals. Washington positions it as a cooperative organization, rather than a way to enforce its own policies. The China-led WAICO, on the other hand, was launched in Shanghai in July 2026 with 29 founding members. WAICO positions itself as a champion of the interests of emerging economies and of accessible AI, drawing upon the impressive surge in open-weight models from Chinese developers. Originally, Washington said it wouldn’t stop Pax Silica members from working with China. The architect of Pax Silica, Under Secretary of State Jacob Helberg, suggested he wasn’t interested in a “purity test” at a Hudson Institute event in January. “If you held everyone to that standard, you would quickly run out of friends,” he said. The U.S.’s patience may be running out. According to an internal draft viewed by Reuters, Washington is preparing a letter to Pax Silica partners, which makes clear that “to be part of everything is to be part of nothing.” (The State Department declined to comment on the letter to Reuters). Yet whether or not Washington ever sends the letter, it reveals a philosophy shared by at least some U.S. officials: If you’re part of the U.S.-led system, you can’t be part of China’s rival order. So where does that leave the eleven-member Association of Southeast Asian Nations (ASEAN)? The bloc has some key strengths, such as data center operating costs below the global average, mature manufacturing infrastructure, and rapid uptake of digital AI applications and clean energy. And the region has long tried to chart a middle path between the U.S. and China. ASEAN states would be wise to resist America’s call to allegiance. In June this year, the U.S. Department of Commerce issued an emergency export control order demanding that Anthropic restrict access to its frontier models, Mythos 5 and Fable 5, to U.S. nationals only. While the order was later lifted, this episode showed Washington’s ability to limit other countries’ access to leading American models whenever it wanted. Also, Chinese AI models are considerably cheaper, thanks to more efficient designs, more competitive pricing strategies, and reduced energy and infrastructure costs. Chinese firms have a lead in AI applications and diffusion, particularly in manufacturing and logistics, which makes them attractive partners to governments and startups in ASEAN. But a crucial question remains: Can ASEAN members draw from both the Chinese and Western ecosystems in pursuit of their own interests? The answer is: They can, to a surprising degree. So far, just two ASEAN members—Singapore and the Philippines, both longtime U.S. security allies—have signed on to the Pax Silica regime. Yet states with significant two-way exposure to both U.S. and Chinese technologies have stayed out of the fray. These include Malaysia, with growing semiconductor packaging capacity and data center presence; Indonesia, with a sizable talent dividend and untapped renewable energy; and Thailand, with a mature electronics and EV sector with a sizable Chinese presence. Some ASEAN countries have tried to tap loopholes in semiconductor export controls. But hedging is more than just exploiting gaps. Malaysia has made it clear that it pursues a policy of neutrality, and its former trade and industry minister has explicitly stated that the policy of neutrality includes securing access to chips from both NVIDIA and Huawei. The country accounts for 13% of global outsourced semiconductor assembly, testing, and packaging; the electrical and electronics (EE) sector accounts for 44.3% of the country’s total exports.  Malaysia’s two neighbors. Singapore and Indonesia, are leaning into their existing strengths in courting Chinese and U.S. players. Singapore is leveraging its scarce land, energy, and population to bolster its regulatory and agenda-setting power over data centers and sustainability. These have transformed the city into a reference point for “responsible” digital infrastructure. Indonesia, on the other hand, offers its abundant land and potential for power generation to global cloud and AI providers, even as it grapples with an underdeveloped infrastructure and human capital constraints. The Indonesian 360 MW Batam campus will run 170,000 Nvidia accelerators from Q1 2027, operated by the Australian AI infrastructure firm Firmus Technologies and co-developed by Singapore-headquartered DayOne,  while Indonesia supplies the land and power. There are certainly challenges. Talent flight across many ASEAN economies prevents them from developing the technocratic capacity needed for advanced technology and energy sectors. Malaysia needs 50,000 engineers but produces only 5,000 engineering graduates per year. Countries with far smaller digital ecosystems, like Cambodia and Laos, have even greater struggles to attract and retain AI talent. For them, hedging matters far less than their capacity building. A further bottleneck for ASEAN is energy. Coal and gas supply roughly 70% of generation across the top six ASEAN data center markets. Indonesia’s blackouts in mid-2026, in part triggered by the events in the Middle East, demonstrated how fragile the region’s energy security is. Renewables, grid reform, and possible civil nuclear pathways in Vietnam, the Philippines, Malaysia, Indonesia, Thailand and Singapore will determine whether the region has the underlying infrastructure to host and shape AI development—regardless of which flags its cloud computing clusters fly. Five ASEAN states are now actively pursuing nuclear energy; Singapore is studying the feasibility of Small Modular Reactors (SMRs) while Hanoi signed an intergovernmental agreement with Rosatom in Moscow in March 2026 covering two VVER-1200 reactors for its Ninh Thuan 1 nuclear power plant. Nuclear energy shows just how willing ASEAN is to engage with different partners: not just the U.S. and China, but also Russia, India, Japan, South Korea, and the European Union. The U.S.’s hardening stance is indeed a wake-up call—albeit not to choose sides. If ASEAN’s hedging strategy vis-a-vis AI is to become more substantive and less opportunistic, it behooves all ASEAN members, especially those well-endowed with human capital and infrastructure, to scale up and step up in their domestic AI capabilities. The authors would like to thank HKU Musketeers Foundation Institute of Data Science for providing research funding informing this article. The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of  Fortune. This story was originally featured on Fortune.com ...read more read less