China's fiscal deficit ratio quickly increased from0.7%in1997to3%in2002,and reached the inter-nationally generally recognized
security line.The
simulation model of
active fiscal policy(SMAFP)is a powerful instrument to research active fiscal policy(AFP.),It accurately simulated the track of China's economic development in the last5years,implementing AFP.According to the fiscal and monetary policies passed by the China's Congress in the March2003,,using SMAFP,we can forecast that in2003China's economy will be increased by8.4%.In2004-2005,in order to guarantee the average annual growth rate of China's economy,will be no lower than7%,whether China still needs to continue AFP or to fade out it or to strengthen it.,This will depend firstly on the world economic development situation.:If world economy would increase by3%annually,China's AFP would be not fade out and should be continued,;if world economy would increase by about 2%annually,,China's AFP must be strengthened.Analyzing the direction of the world economic development in recent century,,it may be concluded with probability of70%that in2004-2005China's AFP would be continued.