German firms warned of trade boycott over slave labour

German companies risk product boycotts in the United States if they fail to fund compensation for Nazi-era forced and slave labourers, a German official has warned.

Otto Lambsdorff, Germany's chief negotiator in talks on a settlement, said it was part of growing pressure on industry to quit stalling on the planned 10 billion mark ($4.6 billion) fund.

"If we really don't get the payments that were promised, there will be considerable boycotts and sanctions against German companies, particularly in the United States," Lambsdorff told Berlin's InfoRadio station.

Parliament president Wolfgang Thierse, the second-highest public official, warned of a "disgrace for Germany" if the compensation drive collapsed.

German industry agreed last December to contribute half the total, with the government to pay the other half. But the fund says companies have contributed only 2.85 billion marks ($1.3 billion) - just over half their share.

As part of the settlement, Germany also is trying to win U.S. government support for shielding German firms against future claims and lawsuits by victims.

Lambsdorff voiced confidence that industry will ultimately find the money and that payments to the aging survivors - a long-forgotten group of Nazi victims - will start this year.

Thierse appealed to industry to show a "sense of morality" and "not calculate in a small-minded way."

The fund, launched last year by major German corporations, said Sunday it might publicly name firms that have failed to contribute to pressure them to pay. Jewish leaders in Germany also called for singling out the laggards.