Thousands demand Taiwan president's ouster

TAIPEI, June 3 (Reuters) Thousands of people rallied in the capital of Taiwan today, joining an opposition call to demand President Chen Shui-bian's resignation over an insider trading scandal involving his son-in-law.

Shouting ''Ah-bian step down'', they gathered near the presidential office in central Taipei as riot police with baton and shields kept watch behind barbed-wire barricades set up to keep protesters at bay.

Chen, whose nick-name is Ah bian, has faced growing pressure to step down after his son-in-law was detained last month on suspicion of using insider information to buy shares of Taiwan Development Corp. from a partly state-owned bank.

''Probe graft to the very end'', said placards carried by the demonstrators.

Chen, whose approval rating has sunk to new lows, and his son-in-law, Chao Chien-ming, have apologised. Chao, who has been detained, has also denied any wrongdoing.

The president has agreed to yield some powers to Premier Su Tseng-chang and approved the resignations of his closest aides in an apparent attempt to deflect pressure from both supporters and opponents to step down.

But Chen's moves were little too late for the People First Party, the island's second-biggest opposition party, which organised the protest.

Analysts said the struggling party was seeking to seize the initiative after Ma Ying-jeou, chairman of the main opposition Nationalist Party, angered many supporters by opposing calls for Chen to be recalled in a parliamentary vote.

Ma called today for a no-confidence vote in parliament against the cabinet because the opposition lacks the two-thirds parliamentary majority for a recall motion to pass.

Under Taiwan's constitution, a no-confidence against the premier, if passed, would force Chen to either choose a new premier or dissolve parliament and call snap elections.

The Nationalists have eyed the premiership since Chen won the 2000 presidential elections ending more than five decades of one-party rule. Chen won reelection in 2004 and is barred by the constitution from running for a third four-year term.

''All who are unhappy with the Democratic Progressive Party's corruption must stand forward and loudly tell the president: please resign and step down!'' said Ma, who plans to run for president in 2008.

Enraged by Ma's refusal to back a recall motion, a protester hurled eggs at the Nationalist headquarters nearby.

''Chen Shui-bian can't be trusted,'' said protester Pan Wei-char, a retired air force lieutenant colonel.

Even former president Lee Teng-hui, a political ally of Chen, has suggested the president should consider stepping down.

''The leader must be changed if he commits a mistake. 'The son of Taiwan' is not just one person,'' Lee said referring to Chen's self-professed nickname. ''Sons of Taiwan are everywhere. Everyone here are sons of Taiwan,'' he added.

Reuters SHB GC1531