Lukas Moodysson: Bought and sold?

Lukas Moodysson's acclaimed new film, 'Lilya 4-Eve', follows a Russian teenager lured into prostitution. Matthew Sweet meets a crusader who's afraid he's been seduced by fame

Lukas Moodysson has had a confusing experience at a London urinal, and he wants to share it. "I went into the bathroom in a restaurant," he says, yanking at the elastic of his black ski hat, "and suddenly, while I was urinating, I heard a man behind me, reading aloud from a book. I got a little scared because I thought he might be a lunatic or something. And I asked him what his book was. It was How to Lose Friends and Alienate People. Then he was giving me the soap, and turning the tap, and giving me a towel to dry my hands." He shakes his head in bewilderment. "We really don't have this kind of thing in Sweden."

Moodysson might be genuinely baffled by this saunter down a strange byway of British service culture; or he might simply be flashing me his democratic credentials. He's the most celebrated Swedish film director after Ingmar Bergman – and even Bergman, who remains his country's principal cultural sage and emperor, has given him an enthusiastic thumbs up. His work fastens upon on subjects you'd assume were beyond his own personal experience. He examined the trials of being a teenage lesbian in Fucking Amal (also known, for propriety's sake, as Show Me Love); the ups and downs of Seventies communal living in Together; and the horrors of human trafficking in his new one, Lilya 4-Ever. And he tends to get the details right – as the grown-up lesbians, former commune members and East European sex workers who have seen his films will attest.

Lilya 4-Ever has already been chosen as Sweden's entry for the 2004 Academy Awards, but I doubt whether this will give Moodysson much joy. His attitude to official approval is somewhere between equivocal and sullen. He used the platform at a recent awards ceremony to reflect upon the pointlessness of awards ceremonies (the audience responded by booing him from the stage). And he won't wear a tie for anyone. I was present at a party thrown in his honour at the Swedish embassy in London. The ambassador and his fellow diplomats dragged up in their dickies and medallions; Moodysson wrapped up his head in a Palestinian keffiyeh. As he entered the room, a venerable Swede, in full fig, leaned towards me conspiratorially. "He's an anarchist, you know," he said. "But his films are rather good. In the one in the commune, he even got the wallpaper right. How could he have known that? He's far too young." And then, after a lull in the conversation, and apropos of nothing: "I own a forest."

"Some people want luxury," reflects Moodysson, on the day of the party, plonked on a capacious white sofa at the offices of his PR firm. "To distance themselves from people who don't have what they have. I'm not like that." In support of this claim, his latest film snuggles up close to the despairing and the dispossessed. Lilya 4-Ever is a punishing road-to-ruin picture about a Russian teenager (Oksana Akinshina) whose desperate desire to escape her life on an end-of-the-world housing estate in the former Soviet Union allows her to be easily tricked into a life of sexual slavery in Stockholm. She believes she is getting on the plane to restart her life with her nice new Swedish boyfriend, who claims to have found her a place to live and a job picking vegetables. Instead, she finds herself imprisoned in an empty apartment, forced to have sex with a series of anonymous men while a pimp lurks outside the door.

Those expecting a replay of the melancholic comedy of Moodysson's first two films are in for a chilly surprise. The principal moment of comic relief in Lilya 4-Ever comes from a scene in which the heroine and her friends spend a night in her fungus-covered bedsit, sniffing glue from carrier bags and popping a random assortment of prescription drugs. The message of the film is clear: instead of rescuing the former Soviet Union from oppression, capitalism has done to it what Lilya's clients are doing to her. "She's treated like a McDonald's hamburger," Moodysson argues. "She's something that you can buy or sell, and throw away when you've finished with it."

We discuss the locations in which the film was made – specifically, the Estonian town of Paldiski, a former Russian nuclear-submarine base an hour's bus ride from the capital, Tallinn. Under Soviet rule, the place was a no-go area for Estonians, and appeared on maps only as a blank space. When the Red Army withdrew from Estonian territory in 1994, they dynamited the official buildings, leaving only the gigantic naval HQ – nicknamed "the Pentagon" by locals – still standing. Moodysson is surprised to learn that I've visited the place, and we share our impressions: the odd way the dynamite has rearranged the buildings into neat piles of concrete slabs; the undisguised suspicion with which the Estonian majority regard the Russians left behind in the town's mildewed apartment blocks; the forbidding wire fence, now riven with holes, that runs a ring around the Pentagon.

Moodysson was born in January 1969, in Malmo. He still lives there with his wife, Coco, and their two sons, in a flat in the town centre. He grew up, like many of his generation – myself included – regarding the Soviet Union with sentimental awe. He idolised the ice-hockey teams who came to play in Sweden and left the country loaded up with gold medals. ("They seemed like wonderful, infallible machines," he coos.)

He wonders whether Russia's enthusiastic adoption of capitalism has been of any benefit to ordinary Russians, and describes a conversation he had with an Azeri taxi-driver on a recent trip to Norway. "He said his whole country was like a whore. You go to a clothes stores and they ask you if you want to have sex. You go into a restaurant and they ask you if you want to buy a girl. When we were making the movie the whole film crew stayed in a rather cheap hotel in Tallinn, and in the evenings we would watch these girls arrive to meet their clients – who were all Finnish tourists – and there was always some guy waiting in the lobby to collect them, and take them on to their next job. But it would be wrong to blame the pimps for it. We're the ones with the money. We're the ones who exploit them. We are the ones who build factories in the Baltic states and pay their workers wages that are too low for them to survive on."

I've heard plenty of film personnel moralise in such a way, most often while they're lolling in a suite at the Dorchester, surrounded by a small sea of mini-croissants and citron pressé. But Moodysson looks physically uncomfortable as he talks, shifting his position on the sofa, dipping his fingers into his turn-ups, adjusting and re-adjusting his woolly hat. He's identified an injustice – human trafficking from Eastern to Western Europe, and made a film about it that is as terrifying as it ought to be. He's arranged for copies of the movie to be sent to women's groups in Tajikistan and Kazakhstan, and appeared on public panels discussing the issues raised by his film. But that doesn't mean he knows what should be done about it.

Making the film hasn't told him how to live. And he tells me a story that seems to illustrate this state of puzzlement and anxiety. He and his wife bought a house in the middle of the Swedish countryside, intending to decamp from Malmo and get back to nature. "But we got cold feet. We spent a day in the garden, but never set foot in the house. We didn't even move in our furniture." The house has now been sold. Malmo, he says, is where his family will remain for the foreseeable future.

In Together, Moodysson satirises those who think they have come up with the answers (you'll remember the couple who deny their child Pippi Longstocking books on the grounds that their central character is a capitalist lackey). But I'm not surprised that promoting Lilya 4-Ever – while being ferried from gala to gala – has left its director feeling particularly torn.

"Of course," he says, "it's very nice to come to a fancy hotel and have someone present you with champagne and chocolates for no reason. Maybe it's something you should do once in a while." He trails off, unconvinced by his own argument. "But when I think about it, I hate it. I really, really hate it." Perhaps he should find out if the man in the lav likes soft centres.

'Lilya 4-Ever' is released on 25 April