STOCKHOLM, Sweden -- Sweden, the self-styled disarmament champion, is tightening controls on weapons exports to deal with its embarrassing new image as an international gun runner.
Stockholm's independent International Peace Research institute says the country ranks eighth in the world league of arms exporters. One expert says Swedish arms were sold to combatants in 63 of the 107 international conflicts between 1950 and 1983.
Not all the sales were legal.
Hardly a day passes without new allegations of government complicity in the violation of Sweden's arms export laws to which private arms companies already have confessed.
The government categorically denies any knowledge and complains the illegal arms trade is hurting its credibility as a crusader for global disarmament.
It recently introduced in parliament a bill including more stringent application of existing guidelines, improved customs supervision and an obligation for the defense industry to inform the government regularly on marketing activities abroad.
But even as the bill was presented another breach of arms export laws allegedly condoned by the government was unraveling. This one, for the first time, implicated a state-owned arms company.
All irregularities under investigation so far have involved private manufacturers of arms and explosives, Bofors and Nobel Kemi. This has led some ruling Social Democrat Party members to call for nationalization of Sweden's renowned arms industry.
But the latest case involves the state-owned FFV arms company, under scrutiny for allegedly selling the 84-mm infantry antitank gun called Carl Gustaf to at least six blacklisted nations, including South Africa, Israel and Saudi Arabia.
In theory, Swedish law prohibits the sale of arms to countries at war or in areas of tension.
Yet Sweden broke its own arms embargo as early as 1966 by exporting Carl Gustaf ammunition to Australian troops in Vietnam. Those were the days when Sweden was called the 'conscience of the world' for its criticism of the U.S. role in the war.
Australia bought the Carl Gustaf system in 1965, but was put on Sweden's blacklist in 1966 because it sent a force to fight alongside U.S. troops in South Vietnam.
The infuriated Canberra government threatened never to buy weapons from Sweden again unless ammunition for the shoulder-held gun was delivered. Sigfrid Akselson, former technical director of FFV, recently revealed that the government ordered the company to secretly sell 10,000 rounds of ammunition to Australia.
The shells were swiftly shipped through the British defense department under a plan supervised by Swedish Defense Minister Sven Andersson, Akselson said.
Dave Davidson, a retired British army major who was FFV's technical consultant in London in 1964-1976, said he helped FFV director Gunnar Svard work out the details.
'A few months after the meeting at the (British) defense department about the Australian shipments I met with Sven Andersson at a reception,' Davidson said in a telephone interview.
'He told me 'I know what you are doing, but officially I don't want to know about it,'' Davidson said.
The contract, allowing FFV to sell weapons through Britian to countries not approved under Sweden's arms export laws, 'was an agreement between England and the Swedish state,' FFV director Rune Nyman told a parliamentary committee March 25.
The British defense department said London had taken for granted that government-run FFV had acted with the Swedish government's consent. The Swedish government has protested its innocence and even says it was not aware that Britain had re-exported the Carl Gustaf system to third countries from 1963 through 1984.
In 1984, FFV told Britain Sweden wished to stop third-country sales. Sweden's changed policy was the result of 1983 legislation which required so-called end-use certificates from foreign buyers to halt the diversion of arms to embargoed countries.
Prime Minister Ingvar Carlsson seemed indignant that the FFV charges involved a defense minister who died last year and thus 'cannot defend himself.' But his government ordered two probes into FFV's arms deals, which also are being investigated by police and FFV auditors.
The four FFV investigations join numerous others by the War Materiel Inspectorate, a parliamentary committee, prosecutors, police and a government-appointed citizens commission, all looking into illegal arms transfers by Bofors and Nobel Kemi.
Bofors investigations have been going on for four years. Company spokesmen claim the government condoned their sales, which thus could not be considered unauthorized.
Two former Bofors executives under investigation contend that two now-dead War Materiel Inspectors had tacitly approved of illegal transfers of Bofors weapons. The law requires the inspectorate's approval of every weapons export shipment.
Inspector Carl Fredrik Algernon committed suicide by throwing himself under a subway train on Jan. 15, 1987 -- half an hour after denying knowledge about an illegal shipment of ammunition to the Gulf state of Oman in 1985. In personal notes he mentioned difficulties in balancing demands from industry, government and customers.
A television investigation, quoting Bofors files, alleged March 24 that Carl Johan Aberg, undersecretary of state in the Foreign Trade ministry and a key promoter of legal Swedish arms exports, masterminded the smuggling to Oman.
Hours earlier Aberg denied involvement before a parliamentary committee, but said he could not say for certain that the arms scandal would not snowball further.
Sweden's illegal arms trade was first exposed in 1984 when a disgruntled Bofors employee told a peace group about the allegedly shady arms deals.
Prime Minister Olof Palme's government helped Bofors win a $1.3 billion contract two years ago to supply India with 400 howitzers. Charges that Bofors bribed Indian arms procurement agents soon surfaced and shook Indian Prime Minister Rajiv Gandhi. But on Jan. 25 a Swedish prosecutor closed an investigation into the alleged unethical payments for lack of evidence.
The only trial and verdict so far came not in Sweden but in Singapore.
Arms dealer Tan Kok Cheng was sentenced March 9 to four years in prison for accepting bribes from Bofors and forging end-use certificates to circumvent Sweden's laws.
Nobel Industries, the Bofors parent company, has admitted that Singapore was systematically used as a transit point for illegal diversions of arms to third countries.
In 1978-1986 the Swedish government approved sales of $280 million worth of howitzers, RBS-70 missiles, anti-aircraft guns, anti-tank guns, ammunition and explosives to Singapore, a peace group has charged.
No one apparently asked whether the 2.6 million-resident city state really needed all this military hardware. It did not -- a lot was forwarded to embargoed countries such as Dubai, Bahrain and Oman, according to Nobel Industries.
The first indictments in Sweden came last May when Nobel Kemi executive Mats Lundberg and businessman Karl-Erik Schmitz were charged with smuggling explosives to Iran, Syria and Egypt. No trial date has been set.
Prosecutors charge that Schmitz is a key procurement agent for the Tehran government, which buys arms to use in its war with Iraq.
The government is believed to have secretly eased arms export controls in the mid-1970s to help an economy hit by multiplied oil prices and because of shrinking national defense budgets.
In 1983, Palme wrote the Indian government offering to sell a wide range of weapons. Aberg, the Foreign Trade ministry official, was upset when the parliamentary committee asked about this letter.
'I know what you are trying to get at, but this is not a double standard,' Aberg said. 'The arms sales are an important part of our foreign and security policy.
'We work for peace and disarmament, but as long as the world continues to arm itself we too must maintain a defense and recognize the right of other countries to defend themselves, including India.'
The new government bill requires a parliamentary committee 'to examine whether Swedish exports of military equipment can be reduced or discontinued completely.'
But a complete ban on arms exports is unlikely. The defense industry needs foreign markets to produce weapons at reasonable prices for the armed forces of this neutral nation of 8.3 million. Sweden, which has not been at war for 174 years, makes a political point of producing most of its military equipment itself.
Opinion polls show most Swedes favor the arms trade, at least the legal parts of it.
Expressen, the country's largest newspaper, said in a recent editorial 'the government and parliament of Sweden must explain what the principles may cost and then adopt a law that reflects our real values, a law we are prepared to live by.
'This hypocrisy must end,' it said.