They didnt replace it solely due to cost. China is very good with long term strategic investment. Just the latest headline https://www.reuters.com/article/us-zte-tencent-chairman/tenc...

They have been surgically copying/reimplementing advanced technology for over 10 years now. While its still mainly for internal consumption (cars, electronics), western suppliers are steadily pushed out of more and more niches, and some products do get exported (LCD panels for example).