• Sweden edition
 
Sweden 'caved to banker' in Saudi arms deal
Former Defense Minister Tolgfors and Prime Minister Reinfeldt at the time of Tolgfors' resignation. Photo: Tomas Oneborg/TT

Sweden 'caved to banker' in Saudi arms deal

Published: 18 Aug 2014 17:12 GMT+02:00
Updated: 18 Aug 2014 17:12 GMT+02:00

The Swedish government's role in the arms factor was revealed in a media scandal in 2012, eventually prompting then-Defence Minister Sten Tolgfors to resign
 
"The Saudi Affair was a key reason that Tolgfors resigned," Ann-Marie Ekengren, professor of international politics at Gothenburg University, told The Local.
 
"This new information has stirred up an old discussion and brought new life into the issue. The question now is how many more heads may roll." 
 
The project, dubbed "Project Simoom", saw the Swedish Defence Research Agency (FOI, Totalförsvarets forskningsinstitut) allegedly creating a shell company called SSTI to handle dealings with Saudi Arabia in order to avoid any direct links between the FOI and the government, Sveriges Radio (SR) reported. 
 
A Swedish prosecutor began investigating the Saudi Affair in 2012, but dropped the case a few months later because the investigation showed "there was no reason to prosecute". 
 
SR has now revealed that classified documents prove that the Alliance government, which took office in 2006, broke off the deal with Saudi Arabia - but quickly repaired the burned bridges upon pressure from banker Marcus Wallenberg.
 

Banker and businessman Marcus Wallenberg. Photo: TT
 
Wallenberg, a prominent businessman on the board of directors for multiple Swedish companies including Ericsson, Electrolux, Saab, and AstraZeneca, wrote a letter to Sten Tolgfors and said that his "Saudi friends" in the business world were not happy, and that the decision to stop work on the factory "threatened important business interests". 
 
In particular, the government's decision threatened Saudi purchases of the Swedish airborne surveillance system Erieye - produced by Saab Electronic Defense Systems, formerly Ericsson Microwave Systems.
 
"My impression is that it is critical that this issue be solved quickly so that all parties are satisfied - otherwise there is unfortunately a risk that several other cooperation areas, not the least of which is Erieye, may fall into the danger zone", Wallenberg wrote in the classified letter to the defence minister.
 

A Saab 340AEW plane with an Ericsson Erieye radar system attached. Photo: Johan Nilsson/TT
 
The letter was published in full in a new book written by journalists Bo-Göran Bodin and Bo Öhman caleld "The Saudi Weapons" (Saudivapen).
 
After the letter was sent, the current Alliance government, led by Prime Minister Fredrik Reinfeldt, soon resumed the operation, and the prime minister re-approved the project at a government meeting in 2008.
 
State Secretary for Foreign Affairs Frank Belfrage, right-hand man of Foreign Minister Carl Bildt, was particularly involved, SR reported.
 
Bildt has only answered questions via Twitter, where he claimed he had never heard of any such letter and then reflected inquiries to the prior government.
 
Belfrage has referred questions to the Foreign Department in general, which has also kept quiet. The Prime Minister has also declined to comment.
 
"Everything I have to say about the Saudi Affair, I have already said to the Committee on the Constitution," Prime Minister Reinfeldt said on Monday
 
International politics professor Ekengren said silence may not be the most effective strategy.
 
"It may be a better strategy to face the storm," she told The Local. "But they're probably hoping the whole thing just blows over, like it did in 2012."
 
Ekengren said that the revelation of the classified letter had "interesting timing" considering general elections were less than one month away - but she doubted that the issue would develop into a game-changer.
 
The original "Saudi Affair" contract, which specified that Sweden would help build a weapons factory in Saudi Arabia in return for the Saudi purchase of Erieye, was drawn up by the Social Democratic-led government of Göran Persson in 2005 - meaning that the Social Democrat party may also have cobwebs to hide. 
 
"I don't think either party is eager to bring it up," Ekengren remarked.
 
"Just as in 2012, the Social Democrats are aware that this could fall back on them. So it may be an issue, but I don't think anyone is going to try to make it too much of an issue."
 
The Royal Family of Sweden has also been implicated in the drama. 
 
The project was in jeopardy in 2004, when Saudi interest in the Erieye radar system began to wane. A delegation - reportedly led by Crown Princess Victoria - was sent immediately to Saudi Arabia to secure business affairs. 
 

Crown Princess Victoria meeting a delegation from Saudi Arabia in 2008. Photo: Jessica Gow/TT
 
"Without Victoria the delegation would never have gained access to the country's highest political sphere," wrote Bodin and Öhman in their book. 
 
"Saudi Arabia is Sweden's largest trading partner in the Middle East, and Swedish exports to Saudi Arabia are worth nearly 6 billion kronor," Swedish diplomat Gunnar Lund, who accompanied Princess Victoria in the delegation, said in a statement shortly before the trip. "I see good possibilities for expanding our trade."
 
Certain parties, however, are not as engaged in the issue - and are not scared to bring it up. In light of the new information, Jonas Sjöstedt, leader of the anti-weapons Left Party, has demanded that Reinfeldt and Bildt come clean about what happened on their watch.
 
"This is a rotten affair from beginning to end," Sjöstedt told SR. "I think that both Carl Bildt and Fredrik Reinfeldt need to explain themselves."
 
Social Democrat leader Stefan Löfven, who also has a background in the weapons industry, has had few words for the press about the Saudi Affair. On Monday his comments were guarded.
 
"If this is true then it seems very peculiar," Löfven said. "We have made motions in parliament for many years to obstruct weapons exports to certain countries."
 
But while neither Löfven nor Reinfeldt may be eager to pick at the bones of the Saudi Affair, Ekengren said the battle was not over yet.
 
"It may not play a huge role in elections, but this discussion is just beginning."
 
Solveig Rundquist
Follow Solveig on Twitter.

For more stories about Sweden, join us on Facebook and Twitter

The Local/sr (news@thelocal.se)

Your comments about this article

Today's headlines
Stockholm 'Russian sub' alert
Search for foreign vessel continues off Stockholm
Minehunter HMS Koster takes part in the search in the Stockholm archipelago on Sunday. Photo: Marko Säävälä/TT

Search for foreign vessel continues off Stockholm

Sweden's armed forces were continuing to search for the cause of apparent "foreign underwater activity" in the Stockholm Archipelago on Monday. But the military denied news agency reports that they had imposed an exclusion zone. READ  

Ebola crisis
Sweden hit by two Ebola false alarms in two days
The Uppsala University Hospital. Photo: TT

Sweden hit by two Ebola false alarms in two days

UPDATED: A patient has been cleared of any Ebola suspicions at the Uppsala University Hospital. It marks the second suspected case in Sweden in two days. READ  

Perspective: ‘Russian sub’ alert
Why a foreign vessel lurks in Swedish waters
The HMS Stockholm patrols Jungfrufjärden in the Stockholm archipelago on Monday morning. Photo: Anders Wiklund/TT

Why a foreign vessel lurks in Swedish waters

With Sweden engaged in its biggest domestic military operation since the Cold War, The Local spoke to Johan Wiktorin, a fellow at the Swedish Royal Academy of War Sciences, to get insight into what’s going on in the Stockholm archipelago. READ  

My Swedish Career
US woman starts up Swedish toy store online
Leigh Neil and a llama hand puppet. Photo: Private

US woman starts up Swedish toy store online

For this week's My Swedish Career we meet Leigh Neil, who one day came to realize that there was a gap in the Swedish market for children's toys and decided to do something about it. READ  

Stockholm 'Russian sub' alert
No truth to Russia's submarine claim: Dutch
A CB90-class fast assault craft at Kullbäling, a small island in Stockholm's archipelago. Photo: Anders Wiklund/TT

No truth to Russia's submarine claim: Dutch

The Netherlands on Monday denied a Russian claim that a mystery vessel the Swedish military has been looking for could be Dutch. READ  

Lufthansa Strike
Over 20 Swedish flights hit by Lufthansa strike
Grounded Lufthansa planes. Photo: TT

Over 20 Swedish flights hit by Lufthansa strike

A strike by pilots at German airline Lufthansa will affect over 20 flights in and out of Sweden over the next two days. READ  

National
Dentist gives free care to Roma beggars
Photo: Shutterstock

Dentist gives free care to Roma beggars

A dentist in western Sweden is offering free dental care to his town's Roma begging population. READ  

Business & Money
Electrolux profit soars after cost-cutting efforts
Photo: TT

Electrolux profit soars after cost-cutting efforts

Swedish electrical appliance maker Electrolux reported its third-quarter net profit soared 42 percent to 933 million kronor ($130 million) thanks to a cost-cutting programme started at the end of last year. READ  

National
School photographer fired for homophobic slur
Photo credit: Shutterstock

School photographer fired for homophobic slur

A photographer at a high school in southern Sweden was sacked after he called one of the students a "fag" during a shoot. READ  

Ebola crisis
Patient in isolation after airport Ebola alert

Patient in isolation after airport Ebola alert

A male passenger who landed at Stockholm's Arlanda airport has been transferred to an isolation unit amid fears he may be suffering from the Ebola virus. But a specialist was keen to play down concerns. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Gallery
PHOTOS: 'Foreign activity' in Swedish waters
National
Sweden deploys troops over underwater threat
Gallery
People-watching: October 19th
TT
Society
QUIZ: How good is your Swedish?
Business & Money
Get your own office in Gothenburg or Stockholm - free for a day
Blog updates

19 October

Getting it (Blogweiser) »

"Follow Joel Sherwood on FB Few watch baseball in Sweden. This is excellent when your team loses..." READ »

 

17 October

Editor’s Blog, Oct 17th (The Local Sweden) »

"Hi readers, Here’s the whole week of news in just 60 seconds. The most-read story was about a..." READ »

 
 
 
National
A Touch of Scandinavia: Reindeer in the kitchen
Lifestyle
What's on in Sweden: October 17th - 24th
Society
The nudity... and nine other things expat men notice in Sweden
Gallery
People-watching: October 15th
Gallery
Your views: Should outdoor smoking be banned in Sweden?
Business & Money
Sweden has 'large hole' in finances
Sponsored Article
Introducing... Finding a job in Stockholm
Society
Monster salmon caught in northern Sweden
Gallery
Property of the week: Lorensberg
National
Scandinavia's child bride
National
Ebola crisis: How is Sweden preparing?
Lifestyle
Sweden's The Bridge to become 'more Danish'
Business & Money
How Sweden is becoming a cashless society
Gallery
Stockholm Burlesque Festival 2014
National
How a little red horse became a symbol for Sweden
Gallery
People-watching: October 12th
Business & Money
The hottest start-ups from southern Sweden
National
What's on in Sweden: October 10th - 17th
National
Stockholm is 'best' region for well-being
Gallery
People-watching: October 8th
National
Five facts to know about Patrick Modiano
Society
My Swedish Career: A French fashionista in Sweden
Society
Swede's anti-bully Facebook tale goes viral
Society
Have you seen Sweden's viral subway cancer campaign?
National
Isis: Swedes linked to Turkish prisoner swap
National
Should Swedes be banned from buying sex abroad?
Gallery
Fredrik Reinfeldt's leaving presents
National
Five Swedish TV shows you shouldn't miss
Gallery
A tool belt, a casserole, and a book. Fredrik Reinfeldt's parliament gifts
TT
Lifestyle
Top five winter festivals in Sweden
TT
National
Sami reindeer herders win mine reprieve
Gallery
Property of the Week: Gamla Enskede
Sponsored Article
How to catch the first lobster of the year
Politics
Ten new minister faces you should know
Tech
First womb transplant baby in world born in Sweden
Gallery
People-watching: October 5th
National
What's on in Sweden
National
Sweden rethinks Afghan translators' protection
Society
Interview with Geena Davis: 'I want to be in a Swedish movie'
Gallery
Stefan Löfven through the years
Team SCA
Sponsored Article
All-female SCA team takes off on Volvo Ocean Race
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

987
jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
www.swedishdowntown.com
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at:
http://psdmedia.se
If you want to drink, that’s your business.
If you want to stop, we can help.

Learn more about English-language Alcoholics Anonymous in Sweden. No dues. No fees. Confidentiality assured.
AA-EUROPE.ORG/SWEDEN