Good question. It's not like IP protection is practical in China--this software WILL be used in China against license. It's also basically impossible to hold Chinese companies (often entangled with the communist government of China) accountable for things like fraud or IP theft.
What they are saying is that even in regards to OSS it wouldn't matter because China has such a disregard for non-Chinese law (and the citizens have blatant disregard for even some Chinese law) and property that they will just outright steal it or otherwise break any law that inconveniences them to just use the software anyway.
Maybe it's just a political statement.