Try to replace this before while loop:
$myFile = "data.xml";
$fh = fopen($myFile, 'w') or die("can't open file");
$stringData = "<?xml version=\"1.0\" encoding=\"ISO-8859-7\" ?>\n\n";

And this:
fclose($fh);
just after.

You are looping through each register of database, and for each one, you are openning the file, writing xml header, writing one register and closing the file, n times.