Well, she was writing fiction, not a factual account, and presumably wanted the freedom to take the story in the way she wanted it to go, and not be constrained by any one specific country or religion, which would simply have allowed bigots to trumpet that she'd got a fact wrong and therefore whatever she said could be ignored.
She was also deliberately pointing a finger at the US, both for the self-interested and sanctimonious politicking clearly apparent there and in Canada (and everywhere else) and as a warning that no country is safe from religious fundamentalism and misogyny -- the horrors in the story come about not because the men in control are from a foreign country or a medieval hidebound cult, but because they are selfish and out to maintain power for themselves, so women in the West aren't automatically safe from this terror; rather this suppression of our rights is something we must continue to guard against in our own societies.** And she has said, repeatedy, that practically everything in The Handmaid's Tale has its basis in historical or contemporary reality.
** but we don't talk socio-politics here, so please don't make any comments about more recent events