Yes, but low cost of production = low quality = not many people buying = low revenue.
And of course they can ban their stuff. I mean, I don't know about the US, and there's most likely even more Chinese stuff over there, but the big majority of Chinese products are banned in the EU because they endanger the health of people. For example a lot of toys are forbidden because the plastic they're made out of is extremely toxic and can be a danger for people's health, especially for small kids. I never order anything that comes from China on Ebay, because I know exactly that it won't pass the customs and that I will have lost my money. I hope they completely ban their stuff

(which I see happening more and more anyway, and that kind of makes sense because it means people will buy more stuff that comes from here and therefore invest money into their own country — much better!)