Soros also noted that outlook for the 17-nation euro zone remains bad.
"The European crisis won't be resolved in structural reforms only. For stimulating the economy, the European Union has to impose strict fiscal discipline on some countries," Soros told reporters on the sidelines of the World Economic Forum (WEF) annual meeting here.
The debt contagion, with its epicentre in Greece, is hurting the European nations and also poses the threat of derailing the fragile global economic recovery.
"... The outlook remains bad for euro zone and the European Union is undemocratic to an extent that steps taken by ECB have not helped all countries, including those with huge debts. Stimulus has to come from the European Union," he said.
According to him, debt default by Greece does not necessarily mean that the country would have to leave the euro zone.
"One of the problems in Greece is that there is a powerful group that is in favour of Greece leaving the euro zone. There are newspapers and business houses that want to pay tax in a local currency and not in euro," he said.
There is a need to further strengthen the 17-nation currency union, Soros added.