Germany to Pay Nazi Victims in Poland : Reparations: Kohl’s Cabinet approves $300 million for Poles who were used as slave labor during World War II.

In a controversial compromise agreement, the German Cabinet approved a plan Wednesday that will provide $300 million in compensation to Polish nationals who were forced into slave labor during the World War II Nazi occupation.

Under the plan, the money will be paid from a fund operated by a German-Polish Foundation for Reconciliation established specifically for this purpose.

The proposal, immediately accepted by the Polish government in an exchange of notes in Bonn and Warsaw, required Poland to renounce all further claims against Germany stemming from one of the most bitter of all Nazi occupations, which lasted from the autumn of 1939 to early 1945.

During a debate on the issue last month in the Polish Parliament, several speakers dismissed the amount as paltry and claimed that Germany has a moral obligation to do more. The Polish weekly youth paper Sztandar Mlodych described the accord as “cheap reconciliation.”

According to one estimate, almost 1 million Poles employed as slave labor by the Nazis still await compensation. Only those who suffered the greatest hardships are expected to be awarded compensation.

Some Polish officials and the main German opposition party, the Social Democrats, argued that those German companies--including Daimler Benz and Volkswagen--that used slave labor in Poland should be forced to contribute to the fund. (Both companies said they have made their own compensations totaling about $20 million.)

Despite the objections, Wednesday’s agreement is expected to resolve one of the most emotional elements of the long-troubled German-Polish relationship.

The accord marks the first major compensation payment by the German government to a former Nazi-occupied country, and political observers predicted that the formula for payment could become a model for settling claims and normalizing relations with other eastern countries, such as Czechoslovakia and the Soviet Union.

German Foreign Ministry spokesman Rainer Mueller said that one round of official-level talks with Soviet representatives had occurred last July in Bonn and that the subject of limited compensation has also been discussed with Czechoslovak officials.

“I can envision how this (Polish settlement) might become a kind of model,” Mueller said.

Wednesday’s agreement comes during a week in which the parliaments of both countries are expected to ratify two separate treaties aimed at normalizing Germany’s relations with Warsaw.

One of those treaties contains a mutual renunciation of force, guarantees minority rights and sets out a framework for expanded economic, political and cultural cooperation; the second reaffirms the present 265 mile German-Polish frontier along the Oder and Neisse rivers.

Chancellor Helmut Kohl’s refusal early last year, before German reunification, to provide that reaffirmation--on grounds that West Germany shared no common border with Poland--was largely viewed as an attempt by the chancellor to retain the support of an estimated 2 million West German voters who still retain strong cultural ties to land lost to Poland in the aftermath of World War II.

At the time, Kohl’s hesitancy triggered a strong international reaction and raised concerns that a united Germany might one day demand the return of those territories.

While the new border treaty specifically rules out any such claims, other worries now plague the frontier, which has become a new, worrisome divider between a rich, confident Western Europe and a poor, struggling Eastern Europe.