I don't think you can really answer this question at all (which country has produced the greatest literature), because ppl base their judgments about this on a variety of different criteria.
for example, when I was doing a year abroad in England I took a course on "The European Novel" and the teacher compared Dickens's
Great Expectations with Stendhal's
The Red and the Black and also veered off on a general discussion of French vs. English Literature (including Madame Bovary). Although they didn't say it directly, most students + the teacher kinda agreed that English Lit was better than French Lit, because Dickens had a happy ending and was more moralistic than Flaubert and Stendhal. They were all kinda shocked not only because Flaubert dared to write about adultery around the same time that English Lit had to mention such things very indirectly and be judgmental about them, but also because he wrote about adultery at all, no matter in which time period.

so, their decision was based on morality, not on how good the writing was. Of course, if you think it's the job of literature to have happy endings, be non-committal and preach morals, English Lit is definitely the best in the world. But that's a very narrow definition of literature, isn't it?