It does not produce them en masse, because it loses economically in terms of cost (without government injections, which I have written about many times, at the expense of taxpayers' money).
They do not have the most advanced equipment, unless Western business, bypassing restrictions, supplies them with the most advanced lithographic equipment.
It's all about global competitiveness.
As we see, everything is also rotten in the USA and the market economy has also long since disappeared. Therefore, this is a competition of state machines - where there are more resources over a long distance.
And of course the key factor is human capital. Everything is bad with it in China. But the USA (the West as a whole) has practically destroyed (and is finishing off) its own. Only a comfortable environment for raising children in the "middle class" without any government censorship or ideology leads to the flourishing of the next layer of people with the maximum outlook and creative inclinations of thinking. The United States is now destroying this layer of people almost as violently as in China.
So time will tell who will win this battle of human and material resources.
"7nm" in China is still far behind advanced developments in the West.
And these are NOT Chinese nanometers, but Western ones, because western equipment is used everywhere there, which will soon be worn out, and there will be nothing to replace it with, and a lot of equipment to produce mass goods! stupid ordinary people don't understand this, that's why they are stupid and easily succumb to Chinese state propaganda, just like the ordinary poorly educated and zombified population in totalitarian Russia naively believes in "import substitution," which is not even close.
It is important to always be many steps ahead of your competitor in order to be the undisputed technological (and then ideological) leader in the world.
China cannot at the moment try on this "crown" of a leader, just as it does not want it totalitarian powers, because China is NOT a leader. It is just trying to catch up with the real leader - the West.