He is essentially speaking German, but in a silly way.
There were some people in the USSR who had Swedish as their mothertongue, so it wouldn't have been impossible to find a local person to play the role!
And as for the porn films... The era of German erotic films was before commercial TV took off. People had to buy or rent the films if they wanted them. The stuff that was available was imported from Germany. I watched a few with my girlfriends, out of curiousity.Those films had a bit of a plot! The difference with normal films was that the acting was worse and when things got hot, they did not cut the scene. It was nothing like what's on some of the cable channels today.