Interviews | Diplomacy | East Asia

Pax Silica and the China-US Critical Minerals Competition

Insights from Maria Shagina.

The inaugural Pax Silica Summit convened stakeholders from: Japan, South Korea, Singapore, the Netherlands, the United Kingdom, Israel, United Arab Emirates, and Australia, alongside guest contributions from Taiwan, the European Union, Canada, and the OECD, Dec. 12, 2025.

The Diplomat author Mercy Kuo regularly engages subject-matter experts, policy practitioners, and strategic thinkers across the globe for their diverse insights into U.S. Asia policy. This conversation with Dr. Maria Shagina – Diamond-Brown Senior Fellow for Economic Sanctions, Standards, and Strategy in the Geoeconomics and Strategy Program at the International Institute for Strategic Studies in London and author of “U.S. Critical Minerals Diplomacy: From America First Deals to Pax Silica” (IISS 2026) – is the 497th in “The Trans-Pacific View Insight Series.”

Explain the U.S. administration’s state-capitalist approach to U.S. critical minerals diplomacy. 

The current U.S. administration has pivoted toward a state-capitalist framework for critical minerals diplomacy, characterized by a direct government role in steering investment, market outcomes, and supply chain architecture. This shift accelerated following Beijing’s April 2025 export controls, which signaled that global supply chains are no longer neutral and that market forces alone cannot mitigate the strategic leverage held by the adversary. 

Unlike the reactive, crisis-driven interventions of the past, Washington now employs a proactive three-track strategy: prioritizing “America First” domestic projects through state-led deals, expanding bilateral agreements supported by government-backed finance, and spearheading the Pax Silica initiative to align capital, reserves, and processing expertise among allied nations. Central to this evolution is a new model of strategic partnerships with the private sector; rather than providing bottomless subsidies, the government uses targeted incentives to de-risk commercial ventures, effectively tethering private capital to national security objectives to ensure a resilient and reliable mineral supply.

Identify the key components of “America First” deals and bilateral dealmaking.  

To secure critical mineral supply chains, the U.S. government has transitioned into an active market architect, leveraging tools such as accelerated permitting, direct equity stakes, offtake agreements, and price floors to stabilize volatile sectors. Domestically, “America First” deals aim to reshore production by centralizing decision-making within the White House and national security institutions, utilizing defense funding and initiatives like Project Vault – a state-led stockpiling mechanism – to de-risk projects that would otherwise struggle to attract private capital. 

Internationally, bilateral dealmaking extends this logic by forging public-private partnerships and joint ventures that decouple supply chains from Chinese-controlled nodes. By deploying public finance institutions like EXIM and the DFC [Development Finance Corporation] to tie financing to strict offtake commitments and integrating these arrangements into broader foreign policy and security agendas, the administration ensures that both domestic capacity and global resource access are steered by strategic state priorities rather than market forces alone.

Examine the main objectives of the U.S.-led Pax Silica initiative vis-à-vis China-U.S. competition over critical minerals. 

Pax Silica is best understood as an economic-security framework designed to build a full-spectrum ecosystem of secure and resilient supply chains required to compete in the AI era. Its objective is not limited to critical minerals alone, but spans what U.S. officials describe as “strategic stacks” of the global technology supply chain. These include software platforms, frontier AI models, connectivity and network infrastructure, semiconductors, advanced manufacturing, minerals........

© The Diplomat