Taiwan's prime minister quit Sept. 7 and said his Cabinet was also prepared to resign over the heavily criticized response to the deadly August typhoon, but the political and economic impact was expected to be limited.

While public anger over the handling of the disaster has been the toughest test for President Ma Ying-jeou since he took office last year, analysts said they did not expect any major fallout.

"Taiwan is politically similar to South Korea, where real power sits with the president, and there is unlikely to be much political instability as a result of the premier's resignation," said Daniel Soh, an economist at Forecast Ltd. in Singapore.

Prime Minister Liu Chao-shiuan, the appointed head of Taiwan's Cabinet, said at a news conference he would leave and that other ministers would offer to do the same over the perceived slow response to Typhoon Morakot, which killed an estimated 670 people as it drenched the island from Aug. 8-9.