The temptation to completely sell out of a long position in Chinese stocks is strong given the country's obvious problems with environmental stewardship and social discontent. The case that emerging economies eventually re-emerge from any temporary difficulties they experience is also strong. It is difficult to accumulate wealth by running away from every sign of trouble. It easier to accumulate wealth by staying invested in an economy with untapped natural resources and an enormous population. The United States was in a similar position in the 19th century and turned out just fine.
Full disclosure: Long FXI with covered calls.