Public skepticism about GMO's has been growing in China and the government there is extremely concerned with anything that can enrage popular discontent.
Just because it's no longer legal to grow genetically modified foods in China doesn't mean that Chinese corporations won't use them. Making GM seeds illegal cuts out a lot of red tape for both the government and the companies, gives China plausible deniability if things go badly in the future, and also gives the government a way to research China's own GMO crops that will somehow be different from the dangerous Western-created GMO products.
"It might help if we ran the MBA's out of Washington." -- Admiral Grace Hopper