Nobel prize winner Christopher Pissarides expressed the belief that mistakes made in the near past concerning the Cypriot economy will not be repeated since the situation is now supervised by the European Central Bank (ECB).

Speaking during an event organized by OXygono NGO on the current situation and the future of the Cypriot economy Pissarides said that the financial crisis in Cyprus was caused by overconsumption, non-productive investments, the mistakes of the households and the banks - which offered very high interest rates - and the poor supervision by the Central Bank of Cyprus.

He also noted that the previous government did not take measures to address the situation on time and that the economic production did not have sound foundations.

Pissarides said that Cyprus, which used to have one of the highest surpluses, ended up having one of the highest deficits in Europe, noting that the European Central Bank is now handling the situation and will definitely not allow something like this to happen again.

He noted that public finances are now much better off, warning however that this happens due to certain circumstances like the investments by foreigners who want to acquire Cypriot passports, and the increase of tourism.

Pissarides noted that Cyprus` tourism model is not viable and that economic distortions exist, adding that Cyprus is at the bottom of the EU countries list in all European assessments.

On his part, Fiscal Council Chairman Demetris Georgiades said that the problems of the Cypriot economy started a long time ago and noted that even though surpluses were not permanent, permanent expenses were created. He also said that overconsumption is the common characteristic of all financial crises.

Georgiades also spoke about inadequate and corrupted institutions that existed in the past, noting the need to recognize mistakes in order not to repeat them.