BERLIN (Reuters) - German's plan for budget savings is a danger to the European single currency project and the euro's design is flawed, billionaire investor George Soros said yesterday.

Soros said the euro was an incomplete currency from the start as the European Union's Maastricht Treaty established a monetary union without a political union.

"The euro is a patently flawed construct," said Soros, who earned $1 billion in 1992 by betting against the British pound. He made his comments during a speech at Berlin's Humboldt University.

Soros also criticised Germany's attitude toward the EU.

"By insisting on pro-cyclical policies, Germany is endangering the European Union. I realise that this is a grave accusation, but I am afraid it is justified," he said.

"By cutting its budget deficit and resisting a rise in wages to compensate for the decline in the purchasing power of the euro, Germany is actually making it more difficult for the other countries to regain competitiveness," he added.

Earlier, Die Zeit, the German weekly, quoted Soros as saying: "If the Germans don't change their policy, their exit from the currency union would be helpful for the rest of Europe."

In his speech, he said the quote did not represent his position.

Instead, he noted "the most ardent instigators ... would prefer that Germany leave the euro rather than modify its position". But he stressed this was a hypothetical scenario that would be painful for Germany.

"The purpose of this thought experiment is to convince Germany to change its ways without going through the actual experience that its current policies hold in store," he added.

Germany's budget savings were "a recipe for disaster because it pushes the debtor countries into a deflation cycle and imposes stagnation and, worse, and that creates resentment", Soros added.

Chancellor Angela Merkel unveiled plans earlier this month for 80 billion euros in budget cuts over the next four years — a package she hopes will bring Germany's structural deficit within European Union limits by 2013.

Merkel defended her plans on Monday after President Barack Obama preached patience in clamping down on public spending.

A German government official said on Tuesday that Berlin did not expect to come under pressure at a G20 summit in Toronto this weekend to provide fresh stimulus measures.