Can those numbers be trusted? https://foreignpolicy.com/2018/03/21/nobody-knows-anything-a...
At the very least we know Chinese companies (and by extension, the government) do indeed spend a lot on research, development and production. The sheer amount of tech made and shipped from China is astonishing. And the quality has massively improved, while prices stay low. Everything from amazing BGA reballing stations to high quality solar panels and power tools.
Cost isn't the only reason that manufacturing is moving out of China; companies are finally realizing that using Chinese factories is tantamount to giving the PRC access to all of your technical IP.