STRASBOURG – The European Union's Czech presidency Wednesday blasted US plans to spend hundreds of billions of dollars to revive its economy as a "way to hell", before downplaying the remark to avert a diplomatic crisis.

Outgoing Czech Prime Minister Mirek Topolanek told lawmakers at the European Parliament in Strasbourg that "the United States is not on the right path" with its costly plans to jump start the world's biggest economy.

"All of these steps, their combination and their permanency is a way to hell. We need to read the history books," he said.

Czech Vice Prime Minister Alexandr Vondra later sought to play down the comment, denying before journalists at a news conference at the parliament that Topolanek made the "hell" remark.

An AFP check of the original recording found that Topolanek did indeed make the comment.

Topolanek is seen at home as being deeply conservative on economic issues and has long opposed state intervention in the economy. He is due in any case to submit his resignation to President Vaclav Klaus later this week after his government was narrowly defeated in a no confidence vote on Tuesday.

The incident cast a shadow over transatlantic economic relations just days ahead of a key G20 summit in London where leaders from the biggest economic powers are supposed to tackle the global crisis.

It also comes ahead of a summit between EU leaders and US President Barack Obama in Prague.

The opportunity to host the US president was supposed to be the crowning moment of the Czech Republic's EU presidency, which has been overshadowed by the collapse of the government and marked by Klaus's open hostility to the EU.

Concern has been expressed over the effect of a political vacuum at the head of the EU at a time of major crisis.

The White House later said that Obama would go ahead with the Prague visit on 4 and 5 April, despite the government's fall.

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