76 Geography Main article: Geography of Sweden Situated in Northern Europe, Sweden lies west of the Baltic Sea and Gulf of Bothnia, providing a long coastline, and forms the eastern part of the Scandinavian Peninsula. Retrieved Jonung, Lars; Kiander, Jaakko; Vartia, Pentti (2009). As in the first world war, Sweden remained officially neutral during World War II, although its neutrality during World War II has been disputed. Sydsvenska Dagbladet (in Swedish). A large portion of the Swedish economy is to this day based on the export of technical inventions, and many large multinational corporations from Sweden have their origins in the ingenuity of Swedish inventors.