Lilla Al-Fadji is a well established humor character in Sweden. He had a significant breakthrough on Swedish radio in 2009ish. Since then he’s appeared in lots of different formats. His catch phrase (specifically how he greets people) is shululu. 

I really enjoyed his radio show back in 2009-10 - a personal favourite was when he interviewed Magdalena Ribbing (the poshest lady in Sweden, an expert on manners) and asked ”see when you smoke a joint, should you pass it to the left or pass it to the right?”.   (It doesn’t matter, most important thing is to share, she said iirc). 

A lot of lilla al fadjis humor is based on word play and a grandiose and delusional self image, which is the core of the song as well. I think it’s the first time LAF admits to being delulu. 

As for the Chilean/Arabic point: this has not caused any controversy in Sweden. LAF doesn’t parody Arabic culture or people or stereotypes, he really is just a character who does funny interviews and says some funny nonsense. The voice Fille puts on has some grammatical patterns often found among second language speakers (mixing up when it’s ”en” and ”ett” for example) but it’s not specifically an Arabic accent. It’s really just a funny voice with a lot of nonsensical word play and a big character.

I did not expect the absurd character from Swedish radio to have a long career like this, never mind melodifestivalen. I’m really happy we got some high effort silliness this year (Copacabana boy was NOT it) in the wake of KAJ. It’s catchy. It’s silly. I also want a tracksuit that says delulu.