"This election result is not a personal result, nor a victory for the KMT, it is a victory for all Taiwanese people," added Ma.


A turnout of more than 75 per cent cast their votes.
Tensions with China

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Taiwan's identity crisis

The KMT's poll victory brings to an end eight years of Democratic Progressive party (DPP) rule under Chen Shui-bian, who is stepping down after the maximum two terms.
Chen's pro-independence policies created recurring tensions with China, Taiwan's biggest trading partner.
Ma said that while he favoured friendlier ties with China, he would not discuss reunification in any of his meetings with Beijing's leaders.
But he has pledged to work for closer ties with China, including a peace treaty to end decades of hostilities between Beijing and the self-ruled island.
Reforms or identity
Taiwanese voters had to decide whether to stick with a party that had struggled to improve ties with China, or switch to one that promises peace and greater profits from the island's giant neighbour.

Hsieh favoured formal independence while Ma preferred eventual reunification once China embraces democracy.


But both candidates had toughened their stances on China following Beijing's crackdown in Tibet.


Economic issues


Taiwan candidates

Frank Hsieh


Candidate for ruling Democratic Progressive Party (DPP)


Propelled into politics after working as a defence lawyer for political dissidents in 1980


Focused campaign on environmental issues, the poor and Taiwan's identity


Has backed cautious opening of Taiwan-China economic links and hopes eventually to accelerate moves to make Taiwan a country distinct from China


Ma Ying-jeou


Candidate for nationalist Kuomintang (KMT) party


Unseated Chen Shui-bian, the current president, as mayor of Taipei in 1998


Focused campaign on reviving Taiwan's economy by introducing common market with mainland China


Has advocated improving relations with China, signing a peace treaty and halting Taiwan's push for independence

However, analysts say Taiwan's faltering economy would have been the number one issue with voters.


Both candidates advocate more direct flights, tourism and investment opportunities between Taiwan and China in order to improve the domestic economy.


Al Jazeeera's Hamish MacDonald in Taipei reported that Taiwan's economy is an overriding theme in the elections.


MacDonald said that there has been an increased awareness among Taiwanese voters that the island's economy is directly anchored to the growth of China.


However, Beijing has imposed certain limits on conducting business transactions from Taiwan.


"Taiwan has a growing economy, yet it lags behind its Asian neighbours," MacDonald reported.


Ralph Cossa from Pacific Forum CSIS, a US based think tank, says:  "Domestic issues, such as the economy and corruption, are bigger than China or foreign policy."


Referendum failure


Meanwhile, the central election commission said that Taiwan's two referendums on joining the United Nations had failed.


The initiative, which asked whether Taiwan should seek to join the global body as "Taiwan" instead of its legal name, the Republic of China, had sparked protest from China.


Beijing sees the initiative as a further move towards full-fledged independence.


Japan, Russia, France and the US had also criticised the referendum as unnecessarily provocative.


Two US aircraft carriers had been deployed to an unspecified area near Taiwan during the election, for what US defence officials said was training exercises.


In 1996, during Taiwan's first democratic presidential election, China fired a series of missiles into the Taiwan Strait, in a sabre-rattling gesture seen as trying to intimidate voters.

Source: Al Jazeera and agencies