BUENOS AIRES (Reuters) - An appeals court convicted former Argentine President Carlos Menem on Friday of smuggling arms to Croatia and Ecuador in the 1990s during a decade in power remembered for free-market reforms and corruption.

The court said it had found Menem guilty of being "coauthor of the offense of aggravated contraband" in a ruling that overturned a lower court's acquittal of the former leader on the same charges two years ago.

Menem, now a frail 82-year-old senator, has been charged with graft in other cases, but Friday's ruling was his first conviction. Several co-defendants, including former Defense Minister Oscar Camilion were also found guilty.

Menem said during the original trial that he was "completely innocent" and had no idea the weapons shipments he authorized to Venezuela and Panama would be diverted to countries under arms embargoes.

Argentina was barred from supplying Ecuador with weapons since it played a peace-keeping role after Ecuador and Peru fought a brief war in 1995. Arms sales to Croatia were internationally banned during the wars that tore apart the former Yugoslavia from 1991 to 1995.

Under Argentine law, Menem can appeal to the Supreme Court.

Still a senator for his home province of La Rioja, the flamboyant Menem governed Argentina from 1989 to 1999, pushing free-market reforms such as the privatization of leading airline Aerolineas Argentinas and energy company YPF.

Such policies have fallen out of favor with many Argentines, who blame them for precipitating a deep 2001-02 economic crisis, and both YPF and Aerolineas Argentinas have been renationalized.

During his presidency, Menem was known for a flashy lifestyle and he married a former Miss Universe half his age after leaving office.

In a 2001 interview with Reuters, Menem's brother Eduardo blamed the former president's arrest for arms-trafficking on rivals who wanted to "wipe him off the political map."

(Reporting by Alejandro Lifschitz; Writing by Helen Popper; Editing by Cynthia Osterman)