State Department Witness Says New "Paxilica" Coalition Will Secure AI Supply Chains; Announces Up to $200 Million for Secure Devices

Jacob Hallberg, testifying before the House Committee on Foreign Affairs, told lawmakers the United States has created an "economic security coalition for the AI century" called Paxilica and is moving quickly to secure the supply chains that underpin artificial intelligence. He said the effort includes partnerships, a new concierge service to help allies adopt U.S. technology and a competitive foreign-assistance process of up to $200,000,000 to support secure, low-cost devices running American software.

"I did not come here today to litigate trade data or walk you through compliance spreadsheets. I came here to speak to you about national survival," Hallberg said, framing the initiative as a national-security priority. He added: "The nation that controls the industrial foundations of artificial intelligence will lead this century." All quotations in this article are attributed to Hallberg during his prepared testimony.

Hallberg said Paxilica brings together an initial group of partners—including Japan, South Korea, Singapore, Israel, the United Arab Emirates, the United Kingdom, Australia, Qatar, the Netherlands and Taiwan—and that India joined the coalition last week. He portrayed the coalition as a way to reduce reliance on adversarial choke points and to favor nations that can build and scale trusted AI infrastructure.

As evidence of momentum, Hallberg said Paxilica members "are growing more than three times as fast as their G7 peers, averaging 3 to 4% of GDP growth per year" compared with about 1% for G7 countries; he presented these figures as part of his argument but did not provide source documents during the oral remarks. Hallberg also warned that China has placed AI at the center of its five-year plan, and he used that point to press the case for U.S. supply-chain security.

On logistics, Hallberg said his office is conducting strategic reviews of several corridors that have previously involved the State Department, naming the Lobito Corridor, the Andes Atlantic Corridor and the Luzon Corridor in the Philippines. He said Paxilica partners will be engaged to expand and modernize those corridors by pairing existing infrastructure with new technologies to improve speed and certainty of deliveries.

Hallberg made a substantive claim about the Panama Canal, saying that China’s control "was entirely unacceptable to our national security," and reported that, in his account, a Panamanian Supreme Court decision had invalidated that control and "paved the way for a buyout by BlackRock." Those statements were presented as Hallberg’s characterization during testimony and were not corroborated within the hearing record.

On industrial capacity, Hallberg described manufacturing as "the muscle of sovereignty," credited senior officials (he named Secretary Lutnick, Secretary Bessen and Ambassador Greer) for U.S. reindustrialization efforts, and said the State Department is facilitating partnerships with large industrial firms and promoting scalable mineral projects in the United States and allied nations.

Hallberg outlined the American AI exports program as a whole-of-government effort involving the White House, OSTP, Commerce and Exim and said a new concierge service will provide Paxilica members consultative support in adopting American technology. He also said the administration launched a competitive process to award up to $200,000,000 in foreign assistance for secure, low-cost devices that operate on the American software ecosystem to broaden trusted edge access globally.

On policy alignment, Hallberg said Paxilica will deepen coordination in three areas: protecting critical infrastructure and sensitive technologies; aligning market incentives and anti-dumping practices; and promoting a pro-innovation AI policy. He referenced recent ministerial work on critical minerals and said anti-dumping coordination is a major effort ahead.

Hallberg noted the United States and India had signed a joint statement on AI opportunity and highlighted a pilot announced by the UAE company G42 to test a "common operating picture" framework that uses cryptographic tracking and real-time verifications to protect U.S. technology. He said, "If successful, this framework could scale across the Paxilica ecosystem."

He closed by saying the administration is "moving in Trump time," expects early results before year-end and invited committee questions.

Next steps: Hallberg remained on the witness panel to take questions from the committee following his prepared remarks, according to the hearing sequence.