BANGKOK -- It is a harrowing time to be in Thailand's farming business. Just ask Taweewong Ieamsri, 74, a farm equipment wholesaler in a Bangkok suburb.
His income dropped more than 20% on the year in 2014, and the worst may be yet to come. So far this year, sales are down 10% compared with the same period last year.
The tough business conditions are being felt industrywide. Some of Taweewong's competitors have gone so far as to offer their sales representatives free overseas trips if they reach their targets.
Farmers are not buying equipment because they are saddled with debt. The previous government of Prime Minister Yingluck Shinawatra ran a controversial program to purchase rice at inflated prices. This prompted growers to take out loans to expand production, counting on higher income. When the government found itself overwhelmed by the transactions and the program fizzled, farmers were left in the lurch.
Slumping international prices for rice and natural rubber are making things worse. And farmers' problems are Thailand's problems, since they account for half of the country's population.
Other sectors of the economy are in limbo.
"We will launch 4G (fourth-generation) by the first quarter of 2015," Somprasong Boonyachai, CEO of Intouch Holdings, told the Nikkei Asian Review on May 22, 2014. Intouch is the parent of Advanced Info Service, Thailand's largest wireless provider.
Hours later, the military launched a coup.
Yingluck's government had been planning to offer 4G wireless licenses in August and November of that year, and AIS was preparing to bid. After taking power, the military postponed the bidding by more than a year, citing a need to prevent corruption.
Some see the decision as ironic: The junta is touting a "digital economy" strategy, yet it has delayed the introduction of faster wireless service.
For years, Thailand has been split between two major political forces.
On one side are the Red Shirts -- supporters of former Prime Minister Thaksin Shinawatra, Yingluck's older brother. Farmers account for a significant portion of this group.
Opposing them are the Yellow Shirts -- anti-Thaksin factions that include many military personnel, bureaucrats and conservatives. The intensifying dispute, and protests that brought parts of Bangkok to a standstill, prompted the military to stage the coup in the name of preventing bloodshed.
"The situation will be better if the Thai military can calm things down," Somprasong said. Many in the business community are optimistic that public order and smoother policy management will lead to an economic recovery.
Thus far, however, their expectations have not been met. Growth, exports and consumption all remain shaky.
Exports totaled $53.3 billion for the January-March quarter, down 4.7% on the year. The drop is being blamed on the declining value of farm products as well as the slowing Chinese economy.
The Ministry of Commerce has lowered the country's export target for 2015 to a 1% increase on the year, to $230 billion, according to an April 28 announcement by Nuntawan Sakuntanaga, director general of Thailand's International Trade Promotion Department. The previous target was a 4% increase.
The Bank of Thailand cut interest rates in March and April to boost exports. Monetary policy should be eased further to mitigate downside risks and provide more support to the economic recovery, as well as to help shore up private-sector confidence, an advocate of lower rates said at the bank's April 29 policy meeting, according to minutes released on May 13.
Domestically, farm equipment is not the only sluggish market. New-car sales declined, year on year, for the 23rd straight month in March. This was partly a correction, following the end of incentives the Yingluck government dangled for auto buyers.
Indonesia in 2014 overtook Thailand as Southeast Asia's largest car market.
The current woes have many longing for the days when Thailand was Southeast Asia's top economic performer after Singapore. The economy earned the nickname "Teflon Thailand" because of its ability to weather any upheaval. Now there are worrying signs.
Consider an index comparing gross domestic product growth since 2005 in seven countries, including Indonesia and other competitive Southeast Asian nations plus China and India. Thailand has ranked at the bottom for some time. This gives the impression that the wave of growth sweeping Asia has passed the country by.
Foreign direct investment is also going elsewhere. From the late 1990s to the mid-2000s, Thailand was almost always the top Southeast Asian target for such investment, according to reports from the United Nations Conference on Trade and Development. But Indonesia, which has a larger population, has supplanted Thailand as the No. 1 recipient.
In 2013, Indonesia took in $18.4 billion worth of investment, 40% more than Thailand's $12.9 billion.
Thailand has no time to lose, yet the military government can be its own worst enemy. One example concerns a plan to build a floodway between Bangkok and Ayutthaya, a province north of the capital that hosts global manufacturers such as Honda Motor.
After the devastating floods of 2011, the government announced a 350 billion baht (about $11 billion at the time) investment to prevent a repeat. Companies including Korea Water Resources, also known as K-water, and Bangkok-based Italian-Thai Development won bids for the projects in June 2013.
Then the junta came along: In June 2014, the National Council for Peace and Order, overseen by the military, ordered all ministries to freeze the flood control projects and reassess their effects.
"We had yet to finalize the contract, so we cannot openly complain about it," said an official at a company that won one of the bids.
In general, the flow of public investment has been slow. One of Thailand's largest cement makers, Siam City Cement, saw a 27% year-on-year decline in consolidated net profit in the three months through March.
Age trap ahead
Thailand has its share of structural problems, too.
The country is poised to become the first in Southeast Asia to grapple with an aging society. One U.N. estimate indicates Thailand's working population -- the 15-64 age range -- will peak sometime between 2015 and 2020.
The effects of the subsequent graying will emerge gradually. On the supply side, Thailand is likely to experience labor shortages and wage inflation. On the demand side, consumption is likely to weaken.
On the political front, there has been little progress toward bridging the gap between the red and yellow camps.
A skewed distribution of wealth lies at the root of the division, but this will take time to resolve. The military government aims to introduce an inheritance tax, along with land and property taxes. But stiff opposition may force the government to adopt watered-down policies; already, it has made some compromises.
Despite these challenges, this ought to be takeoff time for Thailand. The country borders three late-blooming economies -- Myanmar, Laos and Cambodia -- that offer low labor costs. This creates opportunities to capitalize on a division of labor in the area.
The Association of Southeast Asian Nations is set to form the ASEAN Economic Community at the end of this year, accelerating regional integration. Since Thailand is already a key manufacturing base, this opening of markets should be a boon to its economy.
Potential, of course, does not guarantee results.
Nikkei staff writers Tamaki Kyozuka, Yukako Ono and Anchalee Romruen contributed to this report.