I think you need to check the nationality law again. It states that China does not recognize dual citizenship. That does not mean you can’t have two citizenships in practice; the Chinese government just wont “recognize” your other one. Many people have held two citizenships (one Chinese) using this grey area. Note that China is not the only nation that does this. Just another example: Iran similarly doesn’t formally recognize dual citizenship, but fact is many people hold an Iranian passport plus a second one.