In short, because it is based on the moon. Although, officially, China uses the Gregorian calendar (the same one used in Western culture) the traditional calendar is still used to calculate the dates of festivals and celebrations, as well as the luckiest days to hold weddings, move house, or start a business. It is a lunisolar calendar, which means that the date gives an indication of the season (as with a solar calendar) and the phase of the moon. Basically, it takes into account both where the earth is in its rotation around the sun, and where the moon is in its cycle.
Unlike the Gregorian calendar, years are not numbered sequentially continuing forever. Each year is assigned an element (water, earth, fire, metal, or air) and an animal (one of the 12 Chinese zodiac signs). There are five elements and 12 animals so the entire cycle repeats every 60 years. The cycles themselves are numbered, but not the years within them.