ITALIAN JELELWES should focus their efforts on high-end, top-quality products to stay one step ahead of foreign competitors who benefit from lower labor costs, sector experts said at a gold fair.

Italy used to dominate the world’s gold jewelry manufacturing sector but has been recently overtaken by India, with China and Turkey also closing in the race.

“What our manufacturers have to do is to get rid of products with low added value which could be produced in the countries with low labor costs,” Valentino Ziche, chairman of Vicenza Gold Fair, told Returns.

“We must make a leap in quality and produce beautiful things of high value, distinguishable from those made, says in Turkey,” Ziche said on the sidelines of the fair, a global showcase for the latest industry trends.

According to data from UK-based GFMS precious metals consultancy, Italian gold jewelers’ output fell 10 percent to 275 tonnes in 2005, its lowest level since 1988, while gold manufacturing in India, China and Turkey increased. Italy’s leading metal bank, Italpreziosi, estimates gold jewelry output in the country has fallen some 30 percent so far this year, hit by high and volatile gold prices. It expects further falls if gold prices do not stabilize.