The mass resignations followed Premier Liu Chao-shiuan's surprise announcement Monday that he would quit. On Thursday, the defense, economics, and foreign ministers and other officials stepped down and their replacements were sworn in.
Analysts say the new lineup is unlikely to change the China-friendly President Ma Ying-jeou's cross-strait or economic policies. Rather, the shakeup was damage control by a president who's seen his approval ratings plummet.
"In order to save the king, you have to give up some generals," said Shih Cheng-feng, a political analyst at National Dong Hwa University. "I don't see much fundamental policy change."
The reshuffle comes after weeks of scathing criticism that the government had a slow and disorganized response to flooding and landslides in the wake of typhoon Morakot. Some 700 people died, many buried alive under avalanches of mud that were triggered by torrential rains.
President Ma put Premier Liu in charge of the disaster response, keeping a low profile in the days immediately following the storm. Ma has been widely condemned, even by some in his own party, for failing to declare a state of emergency, not fully mobilizing the military and showing poor leadership.
The outcry reached critical mass a few days after the storm, creating the biggest political crisis to date for Ma's presidency.
Image booster or smooth talker?
Analysts say Mr. Wu was tapped to restore the government's public image with his communication skills – an area where the old Cabinet got especially poor marks. But some southern Taiwanese also call him "white thief" a derogatory phrase implying he's an untrustworthy smooth-talker.
The more popular Mr. Chu, the new vice-premier, is being groomed as a possible successor to Ma as the KMT's next presidential candidate.
"He wants to keep a low profile for now, but that [a presidential run] is quite possible in the future," says Liao Da-chi, a political analyst at National Sun Yat-sen University.
The US-educated Chu is known for pushing an airport free-trade zone during his seven-year stint as a county commissioner. He's seen as an expert on finance and accounting.
Top focus is still good ties with China
Both men are expected to continue to push Ma's business- and investor-friendly policies, which include the centerpiece agenda of calming relations with rival China.
China sees Taiwan as part of its territory, to be retaken by force if need be.
Ma's predecessors riled Beijing by trumpeting the self-ruled island's independence. But Ma has sought to avoid irking China and has pushed a raft of commercial agreements to bind the island's economy closer to China's.
So far, his government has inked deals on tourism, direct flights, and investments with Beijing. Specific agreements on banking, markets, and insurance are expected by the end of the year.
Ma is also pushing for a broader free-trade deal with China, known as an "Economic Cooperation Framework Agreement."
Observers say Ma was also frustrated with his economics team's handling of that deal, and seized the current political crisis as an opportunity to oust them.
The former economics minister came under fire for failing to push the cross-strait trade deal more quickly, confusing the public and then publishing an explanatory cartoon brochure that critics say stereotyped southern Taiwanese as ignorant bumpkins.
"The communication for ECFA wasn't going well, and then they had the problem with the cartoon," says Liao.
Investors reacted positively to the new cabinet, sending the island's main stock index up 1.1 percent to a 13-month high.