I wrote another comment arguing that this proposal was both racist and discriminatory, which got flagged and deleted without explanation, presumably because I worded it in such a way as to give an example that might resonate more with Americans by using examples of specific groups of people that have experienced oppression in the US. In the interests of quality discussion on HN, I'm going to make another attempt but…
This came up because of a client request.
Your question about whether people from other countries can be considered trustworthy is completely irrelevant.
The fact is, organizations exist that are at polar odds with governments that exist today. It is not unreasonable to, for example, have a 'Uyghur Oppression Awareness Group' require that all of their data be handled by NOT-CHINA. It has nothing to do with Chinese people, or their ethnicity. It has to do with the fact that if an employee is able to access their data, and the government has an incentive to take that data, the government can easily force that person to hand over that data.
This exists in many countries, Russia, China, USA, Australia, UK, the list is very long.
Your argument is flawed because you're arguing the wrong point. The trustworthiness of an individual is not relevant in any capacity.