To say that ujo is racist is going too far. I refer to a tendency to identify country and ethnic group, nothing more. I can think of two other reasons for this.

(a) The suffix has been used in the past for fruit trees (e.g. pomujo), so that X-ujo implies an organic connection between X-o and X-ujo.

(b) Countries where the inhabitants were named X-o instead of X-ano tended to be rulers and colonisers, not the colonised, though this pattern is not universal.

I should say that I don't believe that Zamenhof would invent a suffix to encourage racism. He originated our language to exert an influence against such attitudes. That is why I don't feel any scruples if I use ujo in speech myself.

erinja:Germanio is a name of a place based on a name of a people. Germanujo implies that it is a place *for* a certain type a person. Like a "monujo" is a place designed to hold money, you could say that "Germanujo" is a place designed to contain germanoj.

According to that (polysemy killer) rationalization, there should be a new word for my monujo, because it is designed to contain not only money, and indeed it contains ID cards, calendars and pictures more often than money.

Btw, thanks for your remark on chinese ethnic groups.