Earlier quoted context omitted.
> "Theft of trade secrets" is how Silicon Valley was built. And blatant copyright violation is a common tool for up-and-coming countries (e.g. the US in the past) to jumpstart their creative sector. But at some point, they all begin to protect their own work (nowadays the US is among the fiercest proponents of a strong copyright). I suspect shanzhai will end, too.
You have the “protecting their work” part backwards. You and I agree that copyright stops people from working. So clearly the way to protect your work is to not be at risk of someone using copyright to stop your work; for example, you can protect your work by not having a copyright law. Lots of people in China have work because copyright is not strongly enforced, and their work is in danger if copyright starts being…
As cheap reproduction is an prerequisite for copyrightable artifacts (don't want to spend too much on creating copies after all), the first high value product in that space is reproduction. Once that infrastructure exists and running it becomes a bottom feeder (everybody can run a printing press), locking in artifacts and thereby recreating scarcity is more lucrative. And that's done through copyright.
Workers (such as the "lots of people in China") rarely enter the picture, it's about who owns the means of production of the highest value goods.
(side note: I'm not a fan of that scheme, but it seems rather inevitable given the incentives)