Outside the US I don’t see this as an insult. For Caucasians they want to know which European country my family was from. Even down to the Italians they want to know if I am northern or southern. poc’s definitely get it more based on what I hear from other mixed Americans.
Honestly once you are in a foreign country people asking your race, ethnicity, country of origin is kind of a guarantee. I would move on with your day or just say it outright and be done.
“Won’t be able to make it for Christmas this year. I’ll try to visit in the summer”
If they give you shit for this saying less is the best option.
“I’m sorry but it is not possible for me at this time.”
I find if you talk to people like you’re replying to an email they give up real quick.