Why not? To discuss stuff in the local language and discuss local news obviously. A local instance makes sense for that. Also allows you to place the server close by the country so that you get low latency.

• more instances are better from a federation point of view
• might have to do with that almost every country had their own language and culture

Why ? Don’t you geddit ? :) (Guess cause languages and dialects)

We have more cultures, languages, and national identities clustered in Europe than anywhere else in the world. Naturally people want an instance for their own.