A statement from China Computer Fed (CCF), released a few days after the award was announced, has asked the government to withdraw from the award reviewing process...The original statement has already been censored from CCF's site; and this is what I found in google's cache, which is in Chinese but you could have it translated with google translate...
I personally feel the innovation in this state award winning project is nothing fancy...but note in its architecture it requires no hard drive installed on end user's computing devices as one of its highlighted features (although most of the computing are still done at those end points). Anything from kernel image to application data are all stored in and provided by remote data center(s) (which could be, of course, state controlled), and they call it cloud storage...So I feel the act of giving award to this particular project by the Chinese government might be a sign that Chinese government is thinking about bringing up censorship, personal behavior and identity tracking to another level -- if so, then FUCK the Chinese government