Rather than incurring a huge fiscal deficit to spur growth, the government should address several "deep-seated" economic problems such as the lack of investor confidence and competitiveness in some industries that have been present long before the global crisis began, an economist said.

Emilio Antonio Jr., president of the Center for Research and Communication Foundation, explained that the deliberate increase in the fiscal deficit would only eventually undermine the country's finances and future growth.

He said the government should instead focus on addressing the deteriorating competitiveness in the export sector, the apparent lack of confidence in the private sector, and weak job creation.

"These are the problems that require strategic responses, more policy interventions, with or without the crisis," he noted.

Antonio said the significant drop in the country's exports is not due to the decline in demand from overseas trading partners, but the lack of competitiveness in terms of quality and production cost. He added sluggish export revenues can be attributed to the decline in peso prices of goods and the drop in peso prices of the US dollar and other foreign currencies.

The economist also cited the relatively slow pace of job creation that has accompanied growth in the past years. He said employment growth in the services sector, though fast, has not fully offset the slowdown in other sectors like agriculture.

Lastly, Antonio said there has been a decline in the proportion of the nation's income spent by the private sector on investment goods. This is largely due to lack of confidence despite the availability of funds and the low interest rate environment.

Meanwhile, Joey Bermudez, president of the Management Association of the Philippines, said that there is no need to mimic stimulus packages being implemented by countries in the West since these "electric shocks" are only appropriate for badly damaged economies.

Bermudez noted the Philippines does not have a housing crisis and its major financial institutions are not in the brink of collapse.

He said any stimulus, whether properly used or not, "comes at a great cost and the cost sometimes obliterates the short-term benefit."

The government has set a budget deficit ceiling of P199.2 billion or 2.5 percent of gross domestic product (GDP) this year as it implements its P330-billion stimulus package for infrastructure and social services programs.

For the first three months, the country's fiscal shortfall has reached P119.7 billion, already nearly two-thirds of the full-year target.

The government has been frontloading spending to overcome the slowdown in the economy, which it also blames for poor revenue collection.