Ikea’s German branch will pay a landmark €6 million compensation for the political prisoners in East Germany who were forced to build its furniture during the Cold War.
It will be paid to a new German government fund aiming to compensate victims of the former East German dictatorship. The compensation from IKEA will heap pressure on other western companies alleged to have profited from the dictatorships.
An independent investigation into the way in which Ikea profited from forced labour, commissioned by the furniture multinational itself, began in 2012.
Ikea will now contribute to the so-called hardship fund, which aims to provide support to victims of the dictatorship in economic distress.
“These victims include, in particular, political prisoners who were forced to work in GDR (German Democratic Republic) prisons,” the German Bundestag said in an official statement.
The fund, which was created in 2021, is being managed by the office of the Union of Victims’ Associations of Communist Tyranny (UOKG). Ikea’s contribution to the fund is voluntary.
The CEO of Ikea Germany, Walter Kadnar, said the firm “regrets wholeheartedly” that Ikea products were produced by political prisoners in the GDR, the communist dictatorship which existed from 1949 until 1990.
“We therefore welcome the implementation of the hardship fund and are pleased to be able to keep our promise,” Mr Kadnar added in a statement.
Dieter Dombrowski, the federal chairman of UOKG, said: “After it became known that the company was involved in forced labour, IKEA accepted our invitation to engage in dialogue.
“Together, we have pursued the path of clarification, and IKEA has met the affected individuals on equal terms. Today’s decision is groundbreaking. We hope that other companies will follow IKEA’s example.”
Mr Dombrowski was a political prisoner in East Germany who was jailed after illegally entering the West. After moving out to West Berlin in the 1970s, Mr Dombrowski became a politician for the Christian Democrat (CDU) party.
