"I'm not at all convinced by the performance of the government and in particular by the chancellor in tackling the crisis," Fischer said in an interview with radio station Deutschlandfunk.
The former foreign minister and one of Germany's best known politicians said Merkel had failed to take the leadership on the issue in Europe - something, Fischer said, all European countries had expected from Germany. "Everyone looks towards the number one in such a crisis. You need a determined forward-looking vision, a strong hand and at least an impression that she (Merkel) knows where she's going," he said.
Germany has passed a massive €500-billion rescue package to help its teetering banks and shore up confidence in financial markets.
The former Green Party icon who served as Chancellor Gerhard Schröder's foreign minister also slammed a stimulus package for the weakening economy approved this week by the German Cabinet.
The measures were tailor-made for the usual dimensions of falling growth rates "but not for the real economy tsunami that's coming our way," Fischer said.