Economy Minister Robert Habeck sees the German economy in "rough waters" as the country is "coming out of the crisis more slowly than we had hoped," he said on Wednesday.
The government expects only a small amount of growth of 0.2% this year, down from the 1.3% it predicted in its autumn forecast.
Last year, the German economy slipped into recession.
Habeck said the reasons for the gloomy economic situation include the historically low growth in global trade, which is particularly difficult for an export nation like Germany, as well as high interest rates, which are hampering companies' investments.
He also referred to the government's need to save following a budget ruling by the Federal Constitutional Court which left the government with a €60 billion ($65 billion) shortfall.
Habeck also cited structural problems in Germany that had built up over many years. A "reform booster" is needed and the government must now work on this, he said.
"It is about nothing less than defending the competitiveness of Germany as an industrial location," he said, referring to the country's labour shortage.
However, there are differing ideas about additional relief within the coalition government. Habeck had proposed a billion-euro, debt-financed special fund, which his coalition partner, the pro-market Free Democrats (FDP), rejects.
A growth package already approved by the Bundestag is in danger of failing due to the conservative opposition. The mediation committee of the Bundesrat and Bundestag is to meet on Wednesday evening.
