They are making a lot of money of this. And why does it matter anyway?
It is not like China itself owns all the miners. Most of the miners are owned by investors and they dont want to see their money fountain get shot.
Again, you don't understand how mining works. Here:
1. You buy a "money fountain"
2. You work your "money fountain" for a few months.
3. You shut down your "money fountain" or buy a new one, because your old one is obsolete. Your old money fountain is a doorstop. If it didn't pay for itself in these few months, you're shit out of luck.