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It could happen I suppose. A lot of games are developed in China, but they're mainly mobile titles and MMOs targeted at the Chinese market (mostly free-to-play).
Even a sizable amount of western AAA development work is done in China (for example by Ubisoft).

Many people seem to think that China is 1.4 billion people with no creativity whatsoever, only making polystations and other knockoff products. I've even seen posts suggesting that here, but that is of course ridiculous.

There are of course incredibly talented creative people in China. There are for example great movie makers that are recognized all over the world for their incredible artistry and craft. Let's not forget that Jenova Chen of Flow/Flower/Journey fame is from Shanghai.