China is trying to disarm its criminals, and has arrested some 50,000 people over the Summer, seized 117,000 guns and prosecuted over a thousand people for illegal arms trafficking. Unlike Russia, which loosened its political and economic controls at the same time in 1991, China kept a lid on politics, and access to guns, after it began eliminating economic restrictions in the late 1970s. As a result, the Chinese economy has been growing at an amazing clip for over two decades. This was a boon to criminal activity, as there was a lot more to steal. Crooks like to have guns, and soon, many potential victims wished to get armed as well.
China was, and still is, a police state, with tight controls on all sorts of things, especially firearms. Corruption in the military made government armories a source of weapons, and smugglers began to move weapons in as well. A favorite source of illegal firearms is Pakistan, which shares a border with China in a sparely populated (except from some opportunistic tribesmen) region. Chinese traders go to Pakistan with cash, and sneak back across the border with guns, or gun parts (to be assembled into weapons inside China.) The Chinese are cracking down on these operations as well. As a result of this, the surviving illegal gun dealers can get very rich, or very dead, these days. The arms trade inside China survives.