This is a weird question and comment because a country doesn't generally make the software. But I suppose they seem to have a lot of influence on the companies. Like surveillance cameras in China.

If I was to say which countries do the most to restrict digital freedom, I'd say look at this table: https://eylenburg.github.io/countries.htm

If I was to say what companies have done the most to take the most privacy from the most people, it would be American big tech like Google and Meta.

There's some okayish software from Israel I can think of, like Zcash.

These Israeli ones are literal criminal companies. What Meta does should be illegal. Both are immoral.

A single spyware against a journalist is much worse than a single Facebook user, but for the total impact on society, they both destroy democracy and human rights significantly.

>I would sooner trust a Chinese company than an Israeli company

As for trust, with privacy I'm a big proponent of avoiding it. Use E2EE or self host if you have to. The country does not matter so much.

Define "hostile to users" a bit more. Chinese devices recklessly place rando back-doors into things, opening up them up to everyone and their mother. Average consumer router firmware? Compromised. They swallow up any and all information they can get their hands on and operate scam centers where they can utilize the info to blackmail people. Israel seems to have a more targeted approach, albeit there is definitely a blast radius. I'm not sure I can say any one country is worse than the other when it comes to cybersecurity. That includes: USA, Iran, North Korea, China, Israel, Russia etc. They all put consumers at risk; whether it's immediate or down the line when the exploits are revealed and other bad actors (scammers) are able to leverage them. It's a lose-lose for us either way.

Some multinationals have their R&D offices in Israel, there's a lot of pretty good research coming out. Russia would probably be worse in terms of trust and they are openly hostile to the West unlike Israel.