I don't know what kind of template that is, but for that particular example I'd do

#!/usr/bin/perl  -w --  
use XML::Twig;


my $twig = XML::Twig->new(
    twig_roots => {
        'item' => sub {
            XML::Twig::Elt->new(
                year => '',
            )->paste(
                last_child => $_[-1],
            );
            $_[-1]->print;
            print $/;
        }
    },
);


my $xml =<<XML;
<item><name>Donald</name><title>I Title</title></item> 
<item><name>James</name><title>II Title</title></item>
XML

$twig->parse('<junk>'.$xml.'</junk>'); # junk cause $xml ain't really 
+xml
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I'd use Template for templating. I'd also use XSLT for xml transformation, or XML::Twig when XSLT isn't suitable.