By Sefa Yürükel
The New World Order Rising from Shanghai
The date is July 16, 2026. At the Shanghai International Convention Center, a ceremony that could change the course of world technology history is taking place. Representatives of 29 states, including Russia, Pakistan, Kazakhstan, Indonesia, Malaysia, Saudi Arabia, the United Arab Emirates, Egypt, Nigeria, Brazil and many others, are signing the founding declaration of the World AI Cooperation Organization (WAICO). This is not merely the birth of an international organization; it is the official proclamation of a tectonic shift in the global balance of technological power.
Over the past decade, the United States of America has invested trillions of dollars in artificial intelligence research, building a massive innovation ecosystem stretching from Silicon Valley to the Pentagon. Giants such as OpenAI, Google DeepMind, Anthropic and Microsoft were setting global standards in every field, from large language models to autonomous systems. However, the document signed in Shanghai shows that the final curtain is opening on American technological dominance. China has learned to use artificial intelligence not merely as a technology but as a geopolitical instrument.
This article will conduct a multidimensional analysis of China’s artificial intelligence strategy. This move, which goes beyond technological competition, can be described, with reference to an ancient Chinese strategy classic, as “playing chess on a Go board.” The second section will examine the founding process and geopolitical context of WAICO, the third section will address China’s AI diplomacy and global dissemination strategy, the fourth section will discuss the challenge to the foundations of US hegemony, the fifth section will evaluate technological multipolarity in the context of the space race and reusable rocket technology, and the conclusion will offer a strategic reading through the metaphor of Go.
The Founding of WAICO: The Bretton Woods of Artificial Intelligence
Founding Members and Geopolitical Composition
The composition of the 29 countries attending the Shanghai Conference is a reflection of China’s strategic mind. These countries were not chosen randomly; each fills a specific gap in the global AI ecosystem or represents a specific geopolitical weight.
Russia, with its nuclear deterrence and cyber warfare capabilities, is a critical partner in the field of military artificial intelligence. Pakistan, as the host of the China-Pakistan Economic Corridor (CPEC), the flagship project of the Belt and Road Initiative, provides strategic depth. Kazakhstan is the largest economy in Central Asia and a key actor in the buffer zone between Russia and China. Indonesia, as the most populous Muslim country in Southeast Asia and the natural leader of ASEAN, is the gateway to the Islamic world. Saudi Arabia and the UAE represent the redirection of Gulf capital toward technology in preparation for the post-oil era. Egypt and Nigeria are strategic allies holding the two flanks of the African continent. Brazil is positioned as a balancing element against US influence in Latin America.
These 29 countries represent approximately 55 percent of the world’s population and about 35 percent of global GDP. More importantly, most of these countries are “middle tier” technology economies that have not been able to fully integrate into the US-led AI ecosystem. China is offering them not only a technology transfer but also a vision of “sovereign artificial intelligence.”
Institutional Architecture: The Technology Version of the IMF and World Bank
The institutional architecture of WAICO is designed in a manner reminiscent of the Bretton Woods system. The organization has three main pillars.
The first pillar is the Artificial Intelligence Infrastructure Fund. Established with China’s initial commitment of 500 billion dollars, this fund provides long-term, low-interest loans to member countries for data center construction, high-performance computing capacity and 5G/6G network infrastructure. This fund is positioned as an alternative to World Bank development loans, and its most critical feature is that loan conditions include “digital sovereignty” commitments rather than Washington consensus reforms.
The second pillar is the Joint Artificial Intelligence Research Centers Network. These centers, at least one of which will be established in each member country, will enable the adaptation of China’s large language models (such as DeepSeek, Qwen, Ernie Bot) to local languages, their training with local datasets and their integration into local applications. This means the global proliferation of China-centric open-source alternatives against Google’s TensorFlow or OpenAI’s GPT ecosystem.
The third pillar is the Artificial Intelligence Governance Council. This council will set data sharing standards, ethical principles and regulatory frameworks among member countries. As an alternative to the EU’s GDPR or the US’s sectoral regulations, it aims to transform the “AI governance model with Chinese characteristics” into a global norm. The council’s first action was to publish the “Declaration on AI Sovereignty.” This declaration recognizes the right of every state to develop, train and supervise its own AI system; it protects states against the transnational data exploitation of large technology companies.
Global Reactions and the US Strategic Dilemma
The founding of WAICO has created a shock effect in Washington. The first statement from the White House claimed that the organization was a “technology cartel of authoritarian regimes” and accused member countries of being “pulled behind a new technology iron curtain.” However, this rhetoric cannot conceal the US’s strategic dilemma.
First, most WAICO members are not traditional allies of the US, nor do they have historically deep ties with China. These countries do not act according to the bipolar logic of the Cold War; they pursue a “non-alignment 2.0” strategy, trying to maximize benefits from both sides. The capacity of the US to punish them is limited because most of these countries already position themselves outside American sanction regimes.
Second, the capacity of the US to offer an alternative vision is weak. The American AI ecosystem is largely driven by the private sector and built on profit maximization. Developing countries are invoiced at market prices for Microsoft Azure or Google Cloud services. In contrast, China offers WAICO members subsidized hardware, free software licenses and comprehensive technical training packages. Although this appears costly in the short term, it is a strategic investment that will ensure China’s technology standards become global norms in the long term.
Third, the founding of WAICO has the potential to render the US’s export controls and sanction regimes in the field of artificial intelligence ineffective. The US had established a comprehensive export control regime with its allies to prevent the transfer of advanced chip technology to China. However, alternative supply chains created through WAICO member countries may provide a legal and institutional framework to circumvent these controls.
China’s AI Diplomacy: The Digital Version of the Belt and Road
Technology Transfer and Dependency Relations
WAICO can also be read as the digital infrastructure pillar of the Belt and Road Initiative (BRI). While the BRI establishes physical connectivity by building ports, railways and energy transmission lines, WAICO builds digital connectivity through data centers, fiber optic cables and AI platforms. This two-layered integration deepens China’s sphere of influence both physically and virtually.
However, a dependency relationship emerges here that must be carefully managed. In the context of the BRI, there were criticisms that the infrastructure loans provided by China turned into debt traps in some countries. The architects of WAICO appear to have learned from this criticism. The organization’s founding documents envisage the gradual implementation of technology transfer, the prioritization of local capacity building and the transfer of intellectual property rights to the host country after a certain period. This is the institutionalized form of the “teaching to fish rather than giving fish” approach.
Nevertheless, this technology transfer is also a standard transfer. China’s AI models will run on China-produced chips, using China-developed software frameworks. Member countries’ engineers will specialize in Chinese systems; their public administrations will become dependent on Chinese-made decision support systems. This is a dynamic that seems to grant sovereignty in the short term but creates structural dependency in the long term.
Language Models and Cultural Hegemony
One of the least discussed but most strategic dimensions of the AI competition is the cultural and linguistic hegemony of large language models (LLMs). Currently, the most advanced LLMs are overwhelmingly trained in English and reflect Anglo-American cultural values, norms and biases. This carries the risk of further consolidating the global dominance of the English language and American culture in the age of artificial intelligence.
One of the most attractive offers China presents through WAICO is the concept of “linguistic sovereignty.” The promise that every member country will have AI models operating in its own language, its own cultural context and its own value system is a powerful center of attraction, especially for countries seeking to consolidate their post-colonial identities. Models optimized for Indonesia’s Bahasa Indonesia, Kazakhstan’s Kazakh, Nigeria’s Hausa, Yoruba and Igbo languages are not merely technical products but also symbols of national sovereignty.
This strategy goes beyond the French Francophonie or the British Commonwealth, building a technology-based cultural sphere of influence. Through WAICO, China exports not only technology but also a “civilizational narrative”: against the West’s singular modernization model, the idea that plural modernities are possible and that every civilization has the right to build its own digital future.
Data Sovereignty and the Rejection of Digital Colonialism
One of the most emphasized concepts in WAICO’s founding documents is “data sovereignty.” This concept refers to a country’s exclusive right to control over the data generated within its territory. In practice, this is a rebellion against the practices of American technology giants such as Google, Facebook and Amazon in collecting, storing and processing user data in developing countries.
Leading figures of post-colonial thought, the academics who introduced the concept of “data colonialism” to the literature, describe WAICO as “the institutional pillar of digital decolonization.” Indeed, for African, Asian and Latin American countries, participation in WAICO is not only a technological but also an ideological choice: the protection of their digital resources by the state against exploitation by foreign companies.
China skillfully uses this narrative. China, which bans Google and Facebook on its own soil and supports domestic platforms such as WeChat and Weibo, is presented as the most successful example of the “digital sovereignty” model. The message given to WAICO members is clear: “We did it, you can do it too.” This is a state-controlled and national interest-oriented alternative to the “connect, expand, monetize” strategy of American technology companies.
The Challenge to the Foundations of American Hegemony
The Erosion of Technological Primacy
American hegemony in the post-Cold War era has risen on four pillars: military superiority, the dollar’s reserve currency status, alliance networks and technological leadership. These four pillars are interconnected, and erosion in one affects the others. China’s WAICO move is a direct attack particularly on the technological leadership pillar.
The United States of America has been the undisputed leader in technological innovation since the Second World War. The transistor, the internet, GPS, the personal computer, the smartphone and now artificial intelligence; all these revolutionary technologies were born or commercialized on American soil. This technological leadership is the basis not only of economic prosperity but also of military superiority, intelligence capacity and cultural influence.
WAICO erodes this leadership in three ways. First, by creating an alternative technology ecosystem, it reduces the global market share of American technologies. Each time a member country prefers Alibaba Cloud over Google Cloud, DeepSeek over GPT, the revenues, data pools and innovation capacity of American companies decrease.
Second, WAICO transfers the standard-setting function to China. In the history of technology, the real winners are not those who make the best product but those who set the standard. Microsoft setting the operating system standard, Qualcomm controlling mobile communication standards, Google standardizing the search algorithm; all these are the building blocks of American technology hegemony. In the age of artificial intelligence, WAICO shifts this standard-setting function collectively to a China-led consortium.
Third, and perhaps most critically, WAICO redirects the talent pool. Until today, the world’s brightest AI researchers went to the US for post-doctoral research and largely stayed there. The research centers WAICO establishes in member countries will encourage these talents to remain in their own regions or move to China instead of the US. Changing the direction of brain drain means, in the long term, changing the location of the center of innovation.
The Financial System and Dollar Hegemony
The AI competition is also a financial system competition. US AI investments are largely financed through venture capital, stock markets and bond issuances. This financing model is based on the dollar’s global reserve currency status and the depth of American capital markets.
WAICO, on the other hand, offers an alternative financing model. Institutions such as the China-led Asian Infrastructure Investment Bank (AIIB), the New Development Bank (NDB) and the Silk Road Fund provide yuan-denominated loans to WAICO members for AI investments. This is not merely a financing choice but also a step toward a gradual decoupling from the dollar.
Moreover, the use of the digital yuan is encouraged for trade in AI services among WAICO member countries. China’s central bank digital currency (e-CNY) is positioned as an alternative to the SWIFT system in cross-border payments. As each WAICO member integrates into the e-CNY ecosystem, the dollar’s dominance in global trade erodes a little further. This is the intersection point of China’s “AI diplomacy” and “financial diplomacy.”
The Military Technology Balance
Artificial intelligence is radically changing the nature of modern warfare. Autonomous weapon systems, drone swarms based on swarm intelligence, AI-powered intelligence analysis and cyber warfare capabilities are shaping the future battlefield. The US has made enormous investments in these fields and aimed to establish an integrated military AI ecosystem with its NATO allies.
As an alternative to this ecosystem, WAICO also envisages cooperation in the field of military AI. Although the organization’s founding documents emphasize “peaceful purposes,” the dual-use nature of AI technology allows civil applications to be easily converted into military applications. Image recognition algorithms can be used for target detection, natural language processing models for intelligence analysis, and autonomous navigation systems for cruise missiles.
Russia’s participation in WAICO makes this military dimension particularly critical. Russia is one of the few countries that can compete with the US in electronic warfare, cyber operations and hypersonic weapons technologies. The integration of these capabilities with China’s AI infrastructure creates a new threat vector for the US and NATO. Joint military AI standards to be developed within the WAICO framework may be one of the most serious challenges to US military technology superiority.
Technological Multipolarity: The New Front of the Space Race
Reusable Rocket Technology: Breaking Musk’s Monopoly
Elon Musk’s SpaceX had remained unrivaled for years in reusable rocket technology. The Falcon 9 and Starship programs had dramatically reduced the costs of access to space and had given the US a near-monopoly position in the commercial launch market. Musk’s flaunting of this success was presented as a symbol of American technological superiority.
However, China quickly broke this monopoly. The Long March 10 (Changzheng 10) reusable rocket system developed by the China Aerospace Science and Technology Corporation (CASC) became operational in 2025 after completing a successful landing test. This is not only a technological achievement for China but also a strategic message: You are no longer unrivaled even in the fields where America is most advanced.
The intersection of reusable rocket technology with artificial intelligence is particularly noteworthy. Critical systems such as precision control of landing maneuvers, engine thrust vectoring and heat shield management require advanced AI algorithms. China’s success in this field is a concrete demonstration of its AI capabilities.
Moreover, low-cost access to space is critical for WAICO’s satellite-based AI applications. AI processors in orbit, space-based data centers and global internet satellites; all these require cheap and reliable launch capacity. China aims to build an alternative ecosystem in space-based AI infrastructure by sharing this capacity with WAICO members.
Artificial Intelligence in Space: The New Frontier
Space and artificial intelligence are becoming increasingly interdependent. On the one hand, AI is used at every stage of space operations, from satellite image analysis to space debris tracking, from autonomous spacecraft navigation to deep space exploration. On the other hand, space offers a unique platform for AI: outside the atmosphere, solar-powered, massive data centers can be established without cooling problems and away from physical security risks.
China aims to institutionalize this vision through WAICO. Among the organization’s long-term plans is an “orbital AI platform” to be jointly financed by member countries. This platform will provide a wide range of services, from real-time monitoring of the earth’s surface to climate modeling, from disaster prediction to agricultural productivity optimization.
The US superiority in this field rests on private sector initiatives such as the Starlink satellite network and Amazon’s Project Kuiper. However, these systems are commercial, and their costs are not accessible for developing countries. WAICO’s collective ownership and cost-sharing model offers an attractive alternative, especially for low-income countries.
Technology Transfer and Joint Production
WAICO’s space pillar also contains ambitious goals regarding technology transfer. China has committed not only to selling launch services to member countries but also to transferring small satellite production technology, ground control station installation and space data processing capacity. This is the adaptation of the “teaching to fish rather than giving fish” philosophy to space technology.
Countries such as Pakistan, Kazakhstan and Indonesia have begun developing their first domestically produced satellites within the WAICO framework. These satellites are assembled with components and technical consultancy provided by China but by the host country’s engineers. This process, on the one hand, realizes technology transfer while, on the other hand, institutionalizes member countries’ dependency on China in space technology.
Go Strategy: Playing Go on a Chess Board
Two Games, Two Mindsets
To understand China’s strategic thinking, it is necessary to grasp the difference between chess and Go. Chess is a game of direct confrontation and central control, focused on checkmating the enemy king. Go, on the other hand, is an indirect and patient strategy game that spreads across the entire board and is based on building regional superiorities.
The United States of America plays chess in the technology competition: it targets the opponent’s strongest piece (Huawei, SMIC, DeepSeek), tries to maintain central control and pursues quick, decisive moves. Sanctions, export controls, supply chain restrictions; these are chess moves.
China, on the other hand, plays Go. It places stones in the corners of the board, connects seemingly unrelated points and slowly builds superiority in regions that the opponent does not notice. The Belt and Road Initiative, the Asian Infrastructure Investment Bank, the Shanghai Cooperation Organization, BRICS and now WAICO; these are Go stones. Each is not decisive on its own, but when they come together, they create a strategic superiority covering the entire board.
Regional Superiorities and Encirclement Strategy
One of the fundamental principles of Go is to surround the opponent rather than attack directly. When you close all the liberty points (breathing points) of a group of stones, that group dies. China’s WAICO strategy is an attempt to close the breathing points of American technology hegemony.
The first breathing point is market access. WAICO members collectively represent more than half of the world’s population. When these markets open to Chinese technology standards, they are considered lost for American companies. The second breathing point is the talent pool. WAICO research centers reduce the brain drain to American universities and companies by absorbing local talent. The third breathing point is financial flows. WAICO’s yuan-based financing mechanisms take a share from the dollar’s global circulation. The fourth breathing point is data flows. Data sharing among WAICO members disables American cloud services and data brokerage platforms.
As each of these breathing points is closed, American technology hegemony suffocates. To express it in chess terms, it is not checkmate; to express it in Go terms, a “seki” (stalemate) or “ishi” (dead group) situation occurs. China is not trying to defeat American hegemony directly; it is building an alternative ecosystem that will render it meaningless.
Thinking Ten Steps Ahead
The phrase “China thinks ten steps ahead of the West” points to the concept of strategic depth. In Go, grand masters anticipate their opponent’s moves dozens of steps in advance and place their stones accordingly. Each stone is part of a long-term strategic plan rather than an immediate tactical advantage.
The founding of WAICO is a product of this long-term thinking. China began preparing the infrastructure for this organization years ago. Physical connections were established with the Belt and Road Initiative, fiber optic networks were laid with the Digital Silk Road, telecom infrastructure was built with Huawei and ZTE, and cloud computing services were expanded with Alibaba Cloud and Tencent Cloud. WAICO is the institutional roof built on all these preparations.
The United States of America, on the other hand, generally thinks about technology competition within a time horizon limited by election cycles. Each new administration revises the previous one’s policies, and long-term strategies cannot achieve continuity. The Chinese Communist Party’s twenty-year, thirty-year planning horizon is the basis of this asymmetric strategic depth.
Conclusion: The Collapse or Transformation of Hegemony?
The document signed in Shanghai on July 16, 2026, may be recorded as a turning point in world history. Eighty-two years after Bretton Woods (1944), the rules of the global order are being rewritten. This time, it is not the United States of America but the People’s Republic of China sitting at the head of the table. This time, the rules are being set not in Washington but in Shanghai. This time, the currency is not the dollar but artificial intelligence algorithms.
However, interpreting this picture as “the collapse of American hegemony from its foundations” sees only one face of reality. History shows that hegemonies rarely collapse with a single blow; they usually go through a long process of erosion and transformation. The fall of the Roman Empire took centuries, the dissolution of the British Empire spanned decades. American hegemony is going through a similar process: absolute dominance is giving way to relative superiority, unipolarity is giving way to multipolarity.
The founding of WAICO is the laying of the technological foundations of this multipolar world. There will no longer be a single AI standard, a single data management model, a single technology supplier. The world will be divided between a China-centric technology ecosystem and a US-centric technology ecosystem; the permeability between these two ecosystems will be limited and countries will be forced to choose one or the other. This is the reflection of the Cold War’s ideological polarization in the technology age.
However, there is a critical difference here: In the Cold War, both sides were trying to destroy each other. Yet today, both China and the US are deeply interdependent. American technology companies need the Chinese market, and Chinese manufacturers need American components. A complete decoupling is not possible and would be destructive for both sides. Therefore, the ultimate goal of WAICO is not to destroy American hegemony but to create an alternative pole to balance it.
China’s last stone on the Go board has not yet been played. The game continues, and there are many more moves to go.
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Sefa Yürükel
Danish ethnographer and social anthropologist (MA)
Aarhus University, 1997
Independent Researcher
Fields of Research: International Politics, Public International Law, Geopolitics, Sociology, Psychology, Cultural Studies, Systems and Structures.
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