Early Industrial Era
Early manufacturing in Thailand started in ancient times and consisted of craft and cottage industries, such as weaving, metalwork, basket-weaving, scroll-work, and gold craft. There was also larger scale production using labourers in alcoholic spirit distilleries and sugar production.
During the reign of King Rama V, Chakri Royal Dynasty, large factories were established by foreign interests. These factories were involved in many different production areas, such as, mint processing, rice mills, sawmill and lumber production. This situation continued until the end of World War 1. After World War 1 there was increased investment in developing local factories by the private sector. Factories were developed for a variety of industries such as, cigarette production, paper mills, beverage plants (soft drinks), and soap production. Due to economic factors caused by the Great Depression (1927), Thailand's industrial expansion plans halted. No more factories were created during this period.
Establishment of the Department of Industrial Works
1) In 1932, the basis of law and administration of the nation changed due to the signing of the Constitution of the Kingdom of Thailand. The new government focused on the economy and its impact on the population. As a result of this focus, the government planned to implement supervision of utilities, as well as operate some utilities with private companies in the form of a public company. For all other industries the private sector were left to operate without government involvement.
2) In 1942, in order to strengthen and develop the industrial sector the government of the time set a policy to support the industrial, commercial and domestic sectors, in order to promote stability. In order to implement this policy the Ministry of the Economy was restructured. The result of this restructure was the dissolution of the Ministry of the Economy and the creation of 2 new ministries; the Ministry of Commerce and the Ministry of Industry.
3) On May 5, 1942 the Department of Industrial Works (DIW) was established and designated as the government agency in charge of the monitoring and supervision of factories owned by the government (SOE's). The department was tasked with monitoring the factories to ensure they were effective producers and to improve the quality and quantity of the products. Moreover they were to maintain the price levels of the products to the general population. They were also to support the industries essential to the country in the time of war.