I'll begin by quoting dodd's answer:
"Internet in China is highly regulated and many usual Web sites are blocked there, say, youtube"
and expand it by saying that even the sites that are not "blocked" (blocked sites include Google, Facebook, Twitter and their subsidiaries like Youtube, Gmail, Instagram, etc.) cam still be extremely slow even at the four star hotel in which I stayed for 1 month while visiting scientists there. In July 2020 I asked a Chinese professor at Qingdao Institute for Theoretical and Computational Sciences (QiTCS) in Shandong University to answer a question on Stack Exchange and he asked me to copy and paste his answer into Stack Exchange myself, because:
"It seems that I always met problem when trying to reply the post in
which at first I didn't believe, because Stack Exchange is not blocked in China. But I asked professors at a completely different university to answer something on Stack Exchange and when the same thing happened, I asked my trusted Chinese academic colleague who told me:
"I chatted with Qu and he told me that he cannot visit Stack Exchange.
You visited here before so you know why :-(
Perhaps of the two of them Ma is more familiar with Internet stuff (He
works for the HPC centre of CAS), he will give it a try later.
Qu is not here and will be back in several days so we can meet in
person and talk about that."
I asked him:
"Is stack exchange blocked? I knew google and facebook are, but I thought stack exchange would be ok"
"I think it is because that stack exchange is depend on some service of
google or some other CDN blocked, which made the webpage cannot be
loaded properly, or at least extremely slow. I checked and found SE
is not blocked. However the internet connection is affected by too
many reasons. From my own experience, when I am at home, visiting
foreign website are all too slow to visit, even they are not blocked,
although Chinese websites are as fast as usual."
So it's not just "blocked" sites like Google, but almost any website can be very hard or inconvenient to access.
Finally, let me comment on a completely different aspect of your question which has less to do with the specific components about Chinese nationals:
"Are there any ethical implications of this? This is, publishing but never refereeing?"
Journals do not pay referees and yet they make a lot of money (almost always) or in cases that appear to be completely altruistic they serve the interests of the people who run the journal in some positive way, at least enough for those people to continue running the journal. I personally have not had a salary since 2018, and while I do still referee papers and take it very seriously, you cannot expect everyone to do it, all the time. Should people who refuse to referee papers be banned from publishing? I don't think so, but if you do ban them, they will publish somewhere else and your journal may miss out on publishing 100s of papers over the course of that academic's group's life span, and since journals typically charge about $30/paper when people don't have a subscription (and annual fees in the thousands for institutions), the journal may lose money or popularity.
If it's a problem for you that people are refusing to referee papers in your journal to the extent that it is making a significant impact on your journal's prosperity, consider suggesting to the higher-ups to come up with better ways to make it worth it for the referees (e.g. more "referee of the month" awards, gift cards, or maybe a small honorarium as a token of appreciation for the work they do to keep your journal running).