If we assume this is happening in a Mandarin speaking country, why to hire someone that doesn't speak the local language?

Does this person bring to the table something that the locals can't? Then, there you have your answer too for the guy that doesn't speak English.

Half the team doesn’t speak Mandarin, which makes it international team, which makes knowing common language vital.

They are doing the job for the fraction of US salary. They know their native market very well. What problem you are seeing there?

They don’t fit international company.

I've brought up before that I've given "no hire" recommendations based on a candidate's inability to speak English, and my coworkers seemed shocked.

Tech culture is very weird in terms of the skills it chooses to prioritize. God help you if you can't put a red-black tree implementation on the board in 15 minutes from memory, but being able to write a coherent 6-page design document (or even understand one!) is asking too much.

Being able to read, synthesize, and write as fast and as well as a mediocre liberal-arts undergrad turns out to be a superpower.