Because it’s a sign they were able to get that manufacturing technology working. It means their equipment is better than it was up until very recently, and they were able to work out the kinks (mainly optics, iirc) stopping them from using ‘7nm’ nodes. It also means that the west is loosing the semiconductor production advantage it has.
Check out Asianometry, he does good videos on semiconductor manufacture, and I believe he did a video or two on China as well.