I wouldn't say that. I would say that the Chinese Government has allowed the free market to take over this task. Take a look at http://www.tomshardware.com/reviews/chinese-arm-soc-mediatek... all high quality ARM SOCs from Chinese suppliers.
Likewise, http://en.wikipedia.org/wiki/MIUI is a fork of Android that reportedly runs faster than Google's stock shell. (I have seen an old version in action on Android 2.2, it was fast, really fast, from what I have read newer versions are just as zippy) Xiaomi has also built up a complete separate (successful!) ecosystem outside Google's, something that Amazon has tried and failed to do.
In another few years you are going to have a Chinese controlled mobile OS being used throughout the Asia Pacific region, running on hardware designed by Chinese companies.
Android is a American open source project. That's not chinese either and they sure as hell can't just get off Windows for Android, yet, if ever. They need a usable desktop OS.
No one is doubting their ability to copy and refine in a limited fashion, but their homegrown attempts have all been massive failures.
The CPU is only one very small part of a chipset. The overall SoC is far more important.
And of course any company that has an Architectural Licence just has to make something that is compatible with ARM. (Although I don't see any of the lower cost SoC manufactures doing this anytime soon!)
And I'd imagine a majority of it is a consequence of the head start. If China had started development of both even in 1981, and sheltered their internal market from our product -- well, it probably would have turned out a lot like the Soviets, viz inability to maintain computational parity. But they would have something more complex.
Good luck developing an entire ecosystem now (ARM aside, but that's mostly due to Wintel's blindless on where mobile was going).
But OS and software? I'm surprised the Chinese govt hasn't just cloned Ubuntu and reskinned it, then mandated the entire country convert to it. I suppose the main problem is, as with everywhere else, too much required enterprise software that is Windows-only.
If it's legal to copy music in the company, it's likely also legal to copy open-source software.
Is a national OS such a non-trivial problem? Interesting how autocratic regimes and their citizens often attack the US on every level, but are happily running US developed software/processors and using US discovered patents on a very important level. I suspect this is further proof that autocracies simply can't compete with capitalistic democracies regardless of the propaganda they believe.