The existence of democracies, especially Taiwan, threatens Xi and the CCP's legitimacy. When the people of China compare their lives with those of other nations, they see democracies having something they want and cannot have. The people of China care about their own lives, and the threat to Xi & the CCP is that they will eventually demand changes or overthrow the them.

There has been an implicit agreement between the people & gov't, which allows the limitation of civil liberties in exchange for rapid progress in modernization and elimination of poverty. As that effort runs out of steam, and the economic system becomes stressed, the agreement begins to break down. One may also note how Jack Ma was reigned in as another thread of the agreement being changed unilaterally by the gov't.