Based on the initial post, I think the question was more like why don't we have companies like SAAB, Hägglunds and Bofors, which make world class arms for the Swedish military.
Culture and "national mythology" probably have a lot to do with it, Sweden has a similar climate, population and GDP as Canada, and I doubt the Swedes are much smarter than Canadians in general. Canadians are also comfortable with the idea that the United States will take care of us, while the Swedes have had Imperial and Communist Russia as a neighbour for centuries, nothing like having a real enemy on your border to focus the mind.