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Wed 11 Mar 2015 12:16 PM

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Sweden to end defence agreement with Saudi Arabia

Riyadh gov't blocked Swedish Foreign Minister Margot Wallstrom from giving a speech to the League of Arab States in Cairo

Sweden to end defence agreement with Saudi Arabia
Saudi Arabia blocked Swedish Foreign Minister Margot Wallstrom from giving a speech to the League of Arab States in Cairo on Monday. (Getty Images)

Sweden said on
Tuesday it will cancel a defence agreement with Saudi Arabia worth billions of
crowns to its industry after criticism of Riyadh's human rights record sparked
a diplomatic row.

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.

"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. "What has happened in recent days hasn't been
decisive."

On Monday,
Saudi Arabia blocked Swedish Foreign Minister Margot Wallstrom from giving a
speech to the League of Arab States in Cairo. A spokesman for Wallstrom said
the decision stemmed from Sweden's criticism of Saudi Arabia's human rights
record.

The Arab League
later agreed a resolution denouncing remarks by Wallstrom to the Swedish
parliament, the Saudi Press Agency reported.

In February,
Wallstrom told parliament Saudi Arabia violated women's rights and criticised
the flogging of human rights activist and blogger Raif Badawi. She also called
Saudi Arabia a "dictatorship."

The cancelled
agreement, which includes military systems, training and transfers of
technology, netted 4.8 billion crowns ($561 million) in 2011-2014.

Sebastian
Carlsson, press officer at 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.

The deal was
first signed in 2005 by a previous Social Democratic government and was renewed
by a centre-right government in 2010.

The Green
Party, junior partner in the current coalition, had called for the accord to be
scrapped.

But 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 defence firms but companies outside the military sector,
31 business leaders said in an open letter published on Friday in the newspaper
Dagens Nyheter. 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 it
can also strengthen Sweden's role in that we treat everyone equally and we
stand up for human rights," he said.

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