Luigi Costantini  /  AP
Gianfranco Albertini, owner of the Vetrerie La Fenice, demonstrates how to blow glass in front of a furnace at his workshop in Murano.
updated 12/20/2010 8:35:01 AM ET 2010-12-20T13:35:01

Four Venetian glassblowers perform a carefully orchestrated dance in front of a red-hot furnace, creating 60 gold-laced glass angels bound for a New York City retailer.

The choreography is enchanting, as one glassblower shapes the glass and hands off to another, who spins it until the angel's head sits atop the conical robe.

But an order of 60 barely keeps the furnaces burning.

Italy's traditional artisanal industries — glass, leather, jewelry, furniture — are under pressure from foreign competition and sometimes outmoded ways of doing business, one risk factor for an economy that needs more growth to convince markets it can handle its large debt burden in years ahead and avoid being drawn into Europe's debt crisis.

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"I remember times when we had six months of orders. Now we have six days," Gianfranco Albertini, owner of the Vetrerie La Fenice, said grimly.

In 2007, there were 1,200 glassblowers working on the Venetian island of Murano, according to the Promovetro consortium. Today, there are just 850, 30 percent fewer. And many of those are working limited hours.

A study by the industry group CNA showed bankruptcies in artisan firms are up 18 percent this year over 2009. The stagnation is emblematic of threats to Italy's economy.

Luigi Costantini  /  AP
Gianfranco Albertini, owner of the Vetrerie La Fenice, demonstrates how to work glass in front of a furnace at his workshop in Murano.

Growth overall has stalled over the last decade to an average of 1.6 percent annual growth, not enough to eliminate questions about the country's ability to stay out of the turmoil that led to bailouts for Greece and Ireland. In decades past, Italy could let the lira fall to gain competitive export advantage — but no more, now that it is in the euro.

And Premier Silvio Berlusconi's battle for his political survival — his razor-thin victory in a vote of confidence this week foreshadows further turmoil ahead — distracts from the need for longer-term reforms and policies that will relaunch the economy — much less the historic Murano glassblowing trade.

Murano's expert glassblowers are purveyors of a thousand-year old tradition, artisans of the highest order. The vibrant patterns, sensual colors of the island's glass are unique in the world. And a good part of it — from the spectacular glass chandeliers, gold-embossed glass fittings and bejeweled mirrors — grace luxurious hotels, yachts and palaces the world over.

By the logic that promotes high-quality craftsmanship as a way to create growth and exports, the Murano glass industry should be thriving as high-end luxury sales take off again.

Cheap Chinese knockoffs
Its downfall hasn't been only cheap Chinese knockoffs that pass for Murano glass in markets around the world, and sometimes even in Venice itself, to the dismay of the glassmakers. But more insidiously, it has been hurt by a lack of innovation in the sector.

Looking ahead, it is innovation that will be key to improving growth and productivity to help Italy out of its mire, economists say.

"The country has stagnated for at least the last 10 years. We have an enormous public debt with no room for maneuvering in the budget. We have low productivity, and growth probably the lowest in Europe," said Marco Annunziata, the London-based chief economic analyst at Unicredit. "And because of the global competition, the system is only going to get worse. We can't waste time."

The ratio of debt to annual economic output is around 118 percent, and is expected to peak at 120 percent in 2012, a heavy load especially compared to the 60 percent ceiling under EU rules. That enormous public debt, which largely funds retirement for Italy's aging population, leaves little room for budget maneuvering. Facing renewed austerity, everyone from university students to opera house workers and elementary school teachers are publicly protesting cuts in the faint hope they will win concessions when the government makes a budget adjustment later this month.

Still, Italy has escaped the debt crisis that has forced bailouts of Greece and Ireland, even if it has seen its borrowing costs raised, along with Spain and Portugal.

Analysts say its greater resilience is due to the low level of private debt, relatively sound banking system, a subdued deficit compared to other countries.

Italy won't return to vigorous growth — the best vaccine against the contagion threat — without modernizing its labor system to give employers more flexibility to confront shifting competitive patterns, Annunziata said. But unions have resisted work rule changes that might help Italy become more competitive and save jobs — and allow workers to move from where they are less productive to more productive.

Now 74, Vetrerie La Fenice owner Albertini started working in the furnaces' melting glare at 10 1/2 and recalls the days when 6,000 plied a trade that holds little interest for young people today, who prefer less physically taxing and more economically secure jobs.

At its cavernous brick workshop, the youngest glassblower has 30 years of experience and they work in much the same way as their forebears hundreds of years ago.

Once the angel's robe and head are shaped, they pull molten glass into wings, two craftsmen each tugging them from opposite ends. Then they tap a molten ball into a halo, and fix it to the figurine. Each angel is laid gingerly in a tempering oven to prevent it cooling too quickly, and shattering.

Davide Camuccio, secretary of the FILCTEM-CGIL union representing the craftsmen, said the island's tradition of focusing their competition on their neighbors, instead of abroad, has kept the industry "fossilized" in old ways.

Camuccio said he has urged the companies, most of which are small and family-run, to work together to seek clients in new markets, instead of waiting for buyers to come to Murano with big orders as in the past, and create economies of scale by sharing warehouses, ovens, and buying primary materials together.

"They tell me they don't want the furnace next to theirs to know how much minerals they use," Camuccio said.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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