World Bank President David Malpass gestures as he speaks during a press conference at the World Bank office in New Delhi on Oct 26, 2019. (PHOTO / AFP)

WASHINGTON - World Bank Group President David Malpass on Wednesday welcomed the extension of debt relief program by the Group of Twenty (G20), calling for further efforts to help the poorest countries tackle the debt crisis.

Earlier this year, "the G20 endorsed a vital debt relief program for the poorest countries, giving people a ray of hope," Malpass made the remarks at the G20 Finance Ministers and Central Bank Governors Meeting, virtually held during the annual meetings of the World Bank Group and the International Monetary Fund (IMF).

The G20 previously endorsed the Debt Service Suspension Initiative (DSSI) to help the poorest countries manage the impact of the pandemic, allowing them to suspend payments on official bilateral debt until the end of 2020.

In the latest meeting, G20 finance ministers and central bank governors agreed to extend the DSSI by another six months, and to examine by April if the economic and financial situation requires further extension

ALSO READ: World Bank sees global economy shrinking by 5.2% in 2020

In the latest meeting, G20 finance ministers and central bank governors agreed to extend the DSSI by another six months, and to examine by April if the economic and financial situation requires further extension.

"The DSSI extension being agreed today is welcome, and the term sheet has been strengthened in important ways," Malpass said.

"However, some core DSSI-related problems are still unresolved, notably lack of participation by private creditors and incomplete participation by some official bilateral creditors," the World Bank chief said.

Malpass also noted that the DSSI, which defers payments into the future but doesn't reduce them, has been a "stopgap" to provide fiscal resources for the poor while a longer-term solution for the debt crisis can be developed.

READ MORE: World Bank launches US$4b financing platform for virus fight

"Given the urgency of the debt crisis, the IMF and World Bank have proposed that we undertake a joint action plan on debt reduction for the most indebted IDA countries," Malpass said, referring to the poorest countries drawing on the World Bank's International Development Association.

Malpass said he would put forward a US$25-billion supplemental COVID-19 emergency financing package to IDA deputies later this month, calling on G20 economies to offer support.

"It's urgent to make rapid progress on a framework because the risk of disorderly defaults is rising," said the World Bank president.