A far-right politician in Sweden is facing possible expulsion from his party after proposing that the municipality where he serves as a councillor build a mosque to attract more immigrants to the city.

Mark Collins, 63, an American who moved to Sweden in 1974, represents the anti-immigration Sweden Democrats on Kramfors municipal council.

He said he believed attracting enterprising immigrants was the best way to fight population decline.

"My idea is that if you have a mosque and a cultural centre, then you empower the Muslims to be responsible for our town and the area up here," he said.

"Hopefully we will get a lot of them to come up and stay."

The town, he said, was losing 100 people a year, with young people in particular moving south to Stockholm and Gothenburg in search of jobs. The surrounding Västernorrland county, meanwhile, was losing as many as 500 citizens a year.

The Sweden Democrats' central leadership quickly condemned Collin's proposal as "sickening".

"This is not our policy and never has been our policy," the party's press chief Henrik Gustafsson told the far-right Nyheter Idag website.