The EU's Jose Manuel Barroso has pledged funds to rebuild Italian refugee centres and called for Europe to "step up" during a visit to an island where at least 298 migrants perished last week.
The European Commission president was heckled by activists and local residents during his stay on Lampedusa, Italy's southernmost point and a major entry point for irregular migrants into Europe.
"Europe cannot turn away," Barroso said after laying flowers on a child's white coffin in an airport hangar, where the bodies of those asylum seekers recovered so far are being stored.
Prime Minister Enrico Letta, who accompanied Barroso, knelt by one of the coffins and said Italy would hold a state funeral for the victims.
"This is a European tragedy," Letta said.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
But there was anger on the island, which has been hit by Italy's devastating economic crisis and where many residents complain they are being left alone to cope with a growing influx of refugees.
"Disgrace! Killers!" shouted a small group protesting at the airport as Barroso arrived.
"This is a message for the politicians to stop these tragedies at sea happening again," a local fisherman told AFP as the sirens on fishing boats were sounded in a gesture of protest.
"We've been living with this for 20 years," he said.
"We've had enough of death. These deaths are on the conscience of Italian and EU politicians."
In Thursday's tragedy, a 20-metre fishing boat crossing the Mediterranean from Libya with some 500 Eritrean and Somali refugees caught fire, capsized and sank within sight of the island.
Some of the 155 survivors said the fire started when the Tunisian captain, who is now under arrest, set light to a T-shirt to attract coastguards after the boat began taking on water.
Terrified passengers, many of whom could not swim, were forced to throw themselves into the dark pre-dawn waters, which were thick with the vessel's spilled fuel oil.
Divers on Wednesday were still recovering corpses inside the wreckage at a depth of about 50 metres and bringing them to shore in black body bags.
They have described nightmarish scenes under the water and say some of the victims may be lost at sea forever because of strong currents in the area.
The disaster has shown up the European Union's flawed asylum policy, which has been criticised for being overly restrictive and forcing refugees to resort to desperate measures to reach Europe.
The EU's Home Affairs Commissioner Cecilia Malmstroem, who was visiting with Barroso and Letta, also said rules on asylum could be reformed to make these perilous journeys less likely.
"We do need to open ways for more regular migration," she said, giving as an example the possibility of "humanitarian visas" and requesting asylum outside European Union territory.
"We need to change our policy on immigration, this restrictive approach has shown its limits."
Some 30,000 migrants have landed in Italy this year - four times more than in 2012.
Barroso promised an extra 30 million euros ($A43.54 million) in funds for Italy for the upkeep of asylum centres to house the growing influx.
