The government of China condones the use of bitcoin I think is because of this reason. They think that the use itself will not benefit their economy's growth and that they think that the growing population of chinese people that are investing in bitcoin might someday make their own national currency obsolete.
Well it is right but the most important thing I would like to share is China is not banning bitcoin completely or they dont dislike bitcoin at all but they shut down the exchanges for some time. May be there is some positive reason behind shutting down the exchanges to give chance price get down so more people will be able to buy bitcoin and invest but one thing I am sure about it that china does not hate bitcoin at all.