Cyprus President Demetris Christofias told an investigating committee Monday that a deadly munitions blast at a naval base in July was a “failure of the system.”

The blast killed 13 people and triggered an economic crisis and calls for Mr. Christofias to resign. He said officials initially underestimated the risk the munitions posed and that he was never made aware of how dangerous they were.

The munitions, containing a mix of gunpowder and nitroglycerine, were seized in 2009 from an Iranian ship headed to Syria as part of international sanctions against Tehran. Cyprus media say authorities knew the munitions were not being stored safely, but failed to take precautions.

The explosion severely damaged the island's largest power facility, causing multi-billion-dollar destruction that is expected to hamper the country's economic growth. Experts say it will take at least a year to fix the power plant, which provides more than half of Cyprus' power demands.

Citing the fiscal and economic conditions caused by the damaged power plant, along with the country's fractious political climate, Moody's credit rating agency last month downgraded Cypriot government bonds two levels and said the outlook for the country is negative.

The crisis led to speculation Cyprus would require a European Union bailout.

The Mediterranean island has been divided into Greek-controlled and Turkish-controlled entities since 1974. Since 2008, the two sides have been negotiating for a reunification of the island under a federal state.