"I hold China's financial regulatory system in very high regard. I think they understand the problems, and they have learned lessons from the mistakes that were made in the West."

He said China was "very successful" in 2008 despite the more than 25 percent drop in export, and China had the resources to help itself sail through the financial crisis. Moreover, it has become the motor of the global economy since then, he said.

Successful transition helps boost stock market

Soros said if China's authorities are successful in changing the growth model in five to 10 years with more production for consumption, it would also help lift China's stock market, which has underperformed the global stock market in the last few years.

Soros said that Chinese stock market did not go up in line with the country's overall economic growth is "not surprising" as that growth was accompanied by lack of profits, whereas stock markets generally reflect the growth of earnings instead of output.

He said if the profits of the companies that cater to the consumers could increase, those winners who can innovate and fulfill the needs and the taste of the consumers could become " very good investments".

"Of course, that would mean a larger portion of the economy would be in the hands of private enterprises rather than State-owned enterprises, and the private enterprises would be more independent from the state. That would be a big improvement in economic performance."

Reasonable property tax helps stabilize real estate

As to the overheated housing price in China, Soros said reform in the real estate sector is also a part of the country's economic transformation.

"I think real estate is rather vulnerable in China, because it has been a favorite form of savings."