It's a move that makes sense, and raises few questions Novell might answer, save political ones. Novell's strategy for SUSE is based on desktops and many nations, including China, see Linux as a way to liberate their desktop users from foreign intervention. It's a win-win deal.
There's also nothing that could be done to prevent it. A major Chinese pursuit of Linux, in any way, is outside anyone's control. (I believe the two characters above combine to mean the future, or Weilai in English letters. Of course I'm taking a German site's word for it.)
But what would it mean if Linux development came to be Chinese-directed? Developers in other countries have long complained about computing being English-centric. How might we feel if the shoe were on the other foot?
I'm not just asking this because my son started taking Chinese lessons today (so at least I'll have a translator around). Chinese and English are foreign to one another in every way. One byte will take just about everything our language can throw at it, while Chinese needs two bytes. Once it gets those bytes, of course, Chinese expression can be very storage efficient. Novels are sold there as a succession of cellphone messages.
Language creates patterns of thought that affect everything else you do, including programming. If the cutting edge of Linux becomes Chinese (or when it becomes Chinese), what are you going to do?