The KMT, which has ruled Taiwan for five decades and seeks eventual reunification with China, retook the powerful post of Taipei mayor from the Opposition in a hard-won race and won a comfortable majority in parliament in Saturday's polls.

Observers have said that while the parliamentary win is more important overall, the Taipei mayoral race has greater symbolic implications.``The victory of (the KMT's) Ma Ying-jeou for Taipei will ease Beijing's anxiousness to settle the Taiwan issue, it helps to stabilize cross-strait ties,'' said political science professor Chang Lin-Cheng of the National Taiwan University.

The KMT's pro-reunification former justice minister beat incumbent Chen Shui-bian from the Democratic Progressive Party (DPP), garnering 51.13 percent of the vote. Chen took 45.91 percent, anadvance of the 43.76 percent he bagged four years ago in Taipei's first direct mayoral elections.

Observers agreed that Ma, who enjoys high popularity for his elegant manners and devotion to promoting welfare for the underprivileged, was the only person in the KMT who could unite the divided ruling party.

He was instrumental in winning back votes from defectors who had switched to support the right-wing splinter New Party.

The KMT's victory is expected to calm Beijing, which feared that a win for Chen would have boosted the pro-independence politician's ambitions for the presidency in 2000.

China, which regards Taiwan as a renegade province, issued a veiled warning to the DPP last week that official separation from the mainland was impossible.

``Beijing will be pretty happy because they have the false perception that the DPP is distancing Taiwan from China,'' said Joseph Wu of the National Chengchi University.

``Now the most important person in the DPP (Chen) has lost the elections,'' he toldAFP.

In Saturday's polls, the KMT took 123 parliamentary seats against 70 for the DPP, 11 for the New Party, one for the Taiwan Independence Party, and 20 for minor groups.

It also grabbed 23 seats in the 52-member Taipei city council against the DPP's 19 and took 24 seats of the 44-seat council in the southern sity of Kaohsiung again st the Opposition's nine.

But the ruling party surprisingly lost the post of Kaohsiung city mayor by a slim margin.