Sweden will cancel its arms deal with Saudi Arabia, Prime Minister Stefan Lofven said in a statement on Tuesday. The decision comes after the oil-rich state blocked the Swedish foreign minister’s speech on human rights at an Arab League meeting on Monday.
"The decision on the Saudi agreement had been made some time ago," the newspaper Dagens Nyheter quoted Prime Minister Stefan Lofven as saying in the Ukrainian capital Kiev Tuesday. "What has happened in recent days hasn't been decisive."
The controversial trade agreement, which included the export of military arms to Saudi Arabia – Sweden’s fourth biggest export market for arms outside the EU – was up for renewal this year, RT said in a report.
Sweden's Social Democrat-led government, which came to power in October last year, has focused its foreign policy on human rights. But its more vocal stance has put it at odds with industry - Sweden is the world's 12th biggest arms exporter - and the coalition government itself has been divided on whether to renew the Saudi Arabia deal.
Earlier on Tuesday, Arab foreign ministers defended Saudi Arabia’s human rights record and criticized Swedish Foreign Minister Margot Wallstrom’s comments in which she accused the kingdom of blocking her speech at the Arab League meeting in Cairo.
Saudi Summons Ambassador
Following the diplomatic fallout between the two countries, Saudi Arabia recalled its ambassador in Stockholm.
“We were informed (Tuesday) that Saudi Arabia had called back its ambassador,” said Swedish foreign ministry spokeswoman Veronica Nordlund.
Wallstrom had been invited to the meeting as a guest of honor, as a nod to her country’s recognition of Palestine last autumn.
The Swedish foreign minister accused Riyadh on Monday of “reacting strongly” to Sweden’s position on human rights issues.
“The explanation we have been given is that Sweden has highlighted the situation for democracy and human rights, and that is why they do not want me to speak,” she told TT news agency in Cairo. “It’s a shame that a country has blocked my participation.”
Wallstrom’s cancelled speech, published on the Swedish Foreign Ministry’s website, touched on the issues of women’s and human rights, as well as the importance of recognizing Palestinian statehood.
The speech did not explicitly mention Saudi Arabia, but rather highlighted the ties between Sweden and the Middle East, urging for continued cooperation.
Lofty Deal
The trade agreement, first signed in 2005, was renewed by the previous center-left government five years ago. The accord netted Swedish firms over $560 billion between 2011 and 2014.
Last Friday, Wallstrom had voiced her support for the accord, saying, “We have a very extensive trade with Saudi Arabia and economic ties and opportunities we all are anxious to retain.”
Sebastian Carlsson, press officer at the Swedish aerospace and defense company ‘Saab’ said other regulation controlled the company’s exports, not the agreement.
“Saudi Arabia is a very important market for us and a good customer,” he said. “How Sweden handles this can affect us.”
Saab does not publish any data on how much it sells to Saudi Arabia or any other country outside Sweden.
However, Swedish industry leaders had lobbied hard for an extension, arguing Sweden’s reputation as a trade partner was on the line.
Cancellation could affect not only defense firms but companies outside the military sector, 31 business leaders said in an open letter published last week. They included fashion retailer H&M’s main owner, Stefan Persson, and Investor Chairman Jacob Wallenberg.
Ulf Bjereld, a professor of political science at Gothenburg University, said the cancellation of the deal could lead to Sweden being isolated in world politics, but stressed that “It can further strengthen Sweden’s role in that we treat everyone equally and we stand up for human rights.”
