Large young workforce, far cheaper than building in the US or Europe, along with still being closer to China for resources, and the more pro-western government is another added bonus.
They could easily argue it was tit for tat.
USA could end Chinese chip production as a retaliation, since they are still dependent on US and European manufacturing machines that they can’t operate on their own. It’d take a decade to catch up and make their own manufacturing equipment. In the meantime they’d make themselves essentially irrelevant to the world if they can’t be relied upon for doing contract manufacturing.
There are many such areas where China would be more hurt be economic decoupling than USA.
Mutually assured economic destruction.
It would also cause every tech company in the western (and western aligned) world to leave China for good.
I find it very strange there aren’t more people ringing the alarm bells about how we’ve positioned China to have the west by the short hairs.