Only Italy knows where the shoe Pinches

With imported Chinese shoes costing less than the leather Italians need to make a pair of loafers, you bet one of the Italy's historic industries is in trouble.

Incensed over loss of business, Italian footwear makers are demanding the European Union slap quotas on Chinese imports levy of import duties on Cheaper Chinese footwear flooding the continent since trade barriers dropped at the start of this year.

Chinese shoe imports to Italy soared 300 percent in the first quarter of 2005 and since have shown no sign of letting up. "We need to impose an anti-dumping procedure to help compensate for the import boom, there is a total competitive imbalance here," says, director general of the National Association of Italian Shoemakers, Leonardo Soana.

The average price for a pair leather shoes from China is down 10 percent as compared with last year, with which even raw materials for one pair of shoes can not be bought, claim most Italian manufacturers.

As in textiles, the blame for this issue is again passed on to "Artificial pegging of Yuan" against euro. Another factor being blamed is labor costs, which by any estimates are being 20 times less in China than in Italy, and looser working and environmental standards, which cost European companies thousands of euros.

The EU, which is already battling China over a surge in textile imports, another fight close to the heart of Italian fashion, said it could take anti-dumping measures on shoe imports after a study showed shipments of six types of Chinese shoes jumped 681 percent in the first four months of 2005.

The flood of imports cost the Italian leather sector -- seen from abroad as one of the bright spots in the country's industry -- about 8,000 jobs last year and would likely knock the same number of people out of work in 2005, claim the industry sources.

Some entrepreneurs say the answer is for Italy to focus on value-added products which require a level of craftsmanship that cannot be replicated in mass-market sweat bbshops.