You know little about the Chinese education system.
All Chinese kids (I was one of them) are basically trained for these kinds of standard tests. For the most part of their school life, they are judged by the scores they get. The whole point of the system is not to educate, but to test, and based on scores, pick the few at the top for better schools to go next year, and the process repeats. This pattern starts from primary schools all up to graduate schools. That's all freaking 16 years!
It is no surprise they score high in this one. They do not need to cheat. Of course if they want they can, but my point still holds: they are battle-tested “exam machines”.
The problem, though, is that the approach kills creativity and innovation.
Threat? Hell no. As long as the States keeps recruiting the best minds with scholarship and offers visa for them to stay working there, I don't see any chance the States will fall behind in smartness.