Taiwan's outgoing President, Mr Lee Teng-hui, who led the island away from authoritarian rule and into an era of democracy, will step down today as chairman of Taiwan's Nationalist Party, following its crushing defeat at the polls last weekend.
Mr Lee (77) has been forced out of office 18 months early by furious party members who blame him personally for their humiliation and loss of power. The move deepens the political crisis which has gripped Taiwan since the victory of opposition party leader, Mr Chen Shui-bian, in Saturday's presidential election.
At stake is not just the leadership of the Nationalist Party, or Kuomintang, but control over its enormous assets, worth billions of dollars.
Mr Lee, who remains president for another two months until Mr Chen's inauguration, called a party meeting for today to submit his resignation. His hand was forced by violent street disturbances outside Nationalist Party headquarters in Taipei, in which many supporters of the breakaway Nationalist Party candidate, Mr James Soong, were prominent.
They believe Mr Soong would have won the election if President Lee had backed him as the official Nationalist Party candidate, rather than the colourless Vice-President, Mr Lien Chan, who came in a miserable third. Mr Lee had, however, fallen out bitterly with Mr Soong, who quit the party and chose to run as an independent.
It is also widely believed in Beijing and Taipei that the Nationalist leader secretly conspired for Mr Chen to win to thwart Mr Soong, and to advance the cause of Taiwan independence.
Supporters of Mr Soong have announced the formation of a new party, but their champion has been coy about saying he will join, leaving open the possibility that he will return to the Nationalist Party. He has every reason to do so.
The Kuomintang owns Taiwan's largest radio station, three TV stations, a newspaper, and a string of cinemas impounded from the retreating Japanese colonisers in 1945. It controls a business empire of property, banks, hotels, industries and overseas investments worth $3.7 billion, according to the Nationalist Party's own figures, or $20 billion, if one accepts the estimate of the business magazine, Wealth.
Mr Soong is hardly the figure to clean up the party and remove the stain of corruption and gangsterism which brought about its downfall. During the campaign he was accused of embezzling $7 million of party funds. Mr Lee is expected to nominate Mr Lien to head a new reform committee to run the party for the time being. He at first stubbornly rejected pleas to go from Nationalist parliament members worried about massive party defections, saying, "Old ginger is spicier."
But yesterday it was clear he had no choice. While he will remain President of Taiwan until May 20th, he has now lost all authority, and can no longer expect that the policies he approves every Wednesday at meetings of the Nationalist Party will be rubber stamped by the cabinet on Thursdays, as has been the case since he became president in 1988.
However, the Nationalist Party still controls the parliament, with 115 of the 225 seats, and has key figures in all the top posts in the police, civil service and armed forces, which will make Mr Chen's grip on power uncertain after he is sworn in.