Outlook for China's economic transformation is hopeful(2)

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."

He said many Chinese bought more than one apartment, so there has been a large accumulation of apartments which are empty just like savings in gold or in a bank.

"I think it is part of the transformation that at least the empty apartments will have to be sold, or maybe taxed. I think they are now a risky investment," Soros said.

He said imposing a property tax would be "very effective," adding it is better to be done "very gradually," "because they are so effective that they could create a crash."

For example, if the property tax is set quite high, a person with five apartments, of which four are empty, would have to sell them if he could not afford the tax bill. Finally the market would be flooded by apartments for sale, Soros said.

"If you have to pay just 5 percent or 3 percent tax every year whether you sell it or not, that would have the effect of pushing some people to sell."

CHARITY HELPS ENHANCE SOCIAL HARMONY

China's fast-growing economy has nurtured an increasing number of rich people in recent years. As a well-known philanthropist, Soros said some of those people have shown real interest in charity, adding it is "praiseworthy" and will contribute to social harmony.

Giving advice to those emerging charitarians in China, Soros said besides the sick and the old, it is "particularly important" to enable the children and the young people to improve themselves, providing them opportunities to learn with more scholarships.