You xpath-query will only match nodes with name "countries" and not nodes that has the type-attribute set to "countries". So you will need to search for nodes that has a attribute "type" with value set to "countries"
Three ways for finding all items for countries
# (1) Find all nodes with a attribute "type" set to "countries"
items = xml.xpath("//*[@type='countries']//item")
# (2) Find only nodes with name "type" and that has the attribute "type" set to "countries"
items = xml.xpath("//type[@type='countries']//item")
# (3) By using css selectors; find only nodes with name "type" and that has the attribute "type" set to "countries"
items = xml.css("type[type='countries'] item")