Basically an attempt to bootstrap an industry brute force style
I eventually upgraded, went off to university, etc. When I finally came home, I found out my mom apparently "borrowed" it, figured out how to install Ubuntu, and has been using it ever since for grading papers and what not.
No idea how much longer it will remain in use, but aside from the awful screen, ironically, honestly, I think the browser and the seemingly ever increasing resource requirements of the web will eventually be the only thing that finally causes an upgrade.
It wouldn't surprise me if these processors are more than fine for municipal workers.
One early example is Chongqing government with Huang Qifan as mayor back in the 2010s.
I'm not sure why local governments would get involved although in general China has had a problem with too much investment and not enough places for it to go. It's not impossible that there are essentially local sovereign wealth funds.