Communist labour for capitalist gain – how the West profited from the East’s prisoners

Berlin Wall in 1978
Trading across walls: Western firms including IKEA and Aldi sourced products from the Eastern side - Edwin Reichert

Ikea has announced that it will pay €6 million to compensate political prisoners forced to manufacture parts for its furniture in socialist East Germany during the Cold War. Like many Western companies, the Swedish furniture giant sourced components from the other side of the Iron Curtain where labour costs were much cheaper than in the West.

Celebrating its 50th birthday this year, Ikea decided to come clean and contribute millions to a fund set up by the German government to provide aid to the victims of the East German dictatorship.

Pressure is mounting on other companies to follow suit. Manufacturing giant Siemens and the German supermarket chain Aldi are among those asked to pay up for allegedly profiting from forced labour.

Thousands of East German political prisoners were forced to work under inhumane conditions. André Wagenzik, who was arrested in the summer of 1983 by the Stasi, the notorious state security service, received a 10-month sentence for “interference with state activity”, legislation that allowed the regime to lock up opponents. He was forced to produce door hinges for Ikea furniture in a gruelling shift system.

Wagenzik recalled that the work quotas were impossibly high. Prisoners who didn’t meet them or refused to work were locked up in tiny cells. He told the BBC that one of his fellow prisoners was kept in solitary confinement for 14 days.

It’s possible that Ikea didn’t know the full extent of the conditions under which its parts were produced. As a neutral state in the Cold War, Sweden had a comparatively friendly relationship with East Germany, and companies may have chosen not to look too closely. But Ikea’s own investigation over ten years ago suggested that staff knew about forced labour in East Germany at the time.

Last week, the CEO of Ikea Germany said “we deeply regret that this took place,” adding that the company would contribute to a hardship fund for those affected.

Other companies have been less willing to respond to calls for compensation. A study by the Humboldt University of Berlin suggested that female prisoners may have been forced to produce women’s tights that were bought by Aldi and offered for low prices in its West German supermarkets. While Aldi said it was sorry that the East German regime used forced labour, it rejected compensation claims on the grounds that it would be impossible to reconstruct supply lines after such a long time.

These particular cases may be in the past, but the issue of forced labour is not. The German car giant Volkswagen has repeatedly faced questions over alleged forced labour of the Uyghur ethnic group at its plant in Xinjiang, China. While claiming that it has no “direct business relationship” with suppliers using forced labour, VW failed to clear all sub-suppliers “as no full supply chain transparency exists”.

BMW and Jaguar Land Rover have also been criticised for buying parts from a Chinese supplier flagged for ties to forced labour in Xinjiang. Last year, another report identified several well-known clothes brands, including H&M and Zara as being at high risk of receiving materials produced by forced Uyghur labour in China.

Ikea may have owned up to achieving better profit margins through forced labour decades ago, but many companies today appear just as willing to look the other way.


Katja Hoyer is the author of ‘Beyond the Wall: East Germany, 1949-1990