At the time that the
Pali and
Sanskrit term "Hinayana" was coined, the
Theravada (Stheravada in Sanskrit) was but one of many
Buddhist Lineages. It is now the only remaining member of what come to be more or less eighteen such schools. This was indeed a polemical term developed by the
Mahayana schools, which began with the Mahasanghika at the Second Buddhist Council several centuries before the Common Era and which now comprise the vast majority of forms of Buddhism throughout the world.
Over the past fifty years in Japan and more recently in the West, the term has been reconstructed as its prominent occurence in classical texts makes it difficult to ignore. Rather than being understood as a reference to any Lineage or school of Dharma, it can be used used to refer to an orientation of self-absorption, of withdrawl and avoidance. As well, to limiting what can be known to what has been known.
It is unlikely that the term bears any relationship to geographical locale. While the surviving Theravadin traditions and practices are primarily associated with Southeast Asian countries, historically this was not always the case. As recently as the 900s Mahayana Buddhist practices and traditions were mingled seamlessly with Hinayana or were in fact primary.
For example, Borabadur in Java is a representation of the "Gandhavyuha sutra" ("Discourse on Entering Into Reality"), the penultimate chapter of the "Avatamsaka sutra" or "Huayen-jing". It is difficult to find a more Mahayana text than this. In fact, the central statement of the Mahayana, the Four Great Vows, comes from Chapter 11 of the Avatamsaka.