The tremor, the largest to hit southern areas in a century, also triggered a series of aftershocks, with the latest being reported at 10:30 am (0230 GMT) Wednesday with a magnitude of 5.9, the central weather bureau said.

One victim was a mother, who died apparently trying to protect her twin sons.

Fang Shu-chuan, 36, was shielding the seven-year-old twins with her body when the three-storey furniture shop where they lived collapsed.

One of the boys was seriously hurt and the other suffered minor injuries.

Fang's 34-year-old brother also died.

At least 42 other people suffered injures in the quake and in the scores of aftershocks.

Some 62 schools in Pingtung reported damage and the estimated loss was more than 40 million Taiwan dollars (1.23 million US) as of Wednesday, said the local bureau of education.

People in Pingtung rushed into the streets in panic during the tremors, which triggered power blackouts in more than 3,000 houses.

High-rise buildings all over Taiwan shook and telephone services in southern parts of the island were disrupted but resumed later at night.

Road and rail traffic was also disrupted by the quake and the subsequent blackouts.

The Taiwan High Speed Rail Corporation halted one southbound "bullet train" to Kaohsiung. The "bullet train" is currently on trial. But rail services in northern Taiwan were unaffected, a company spokesman said.

Internet connections across the Asia-Pacific region were affected due to damage caused by the earthquake to undersea cables.

"Problems with underwater cables have affected Taiwan, Japan, South Korea and China. The Internet capacity in Taiwan is about 40 percent now so the service is jammed," said Taiwan's main telecoms provider Chunghwa Telecom.

But it added the Internet service was expected to return to normal Wednesday evening.

The US Geological Survey said the powerful 7.1 magnitude quake struck 10 kilometres (six miles) under the sea, 57 miles from Kaohsiung in southern Taiwan.

The Taiwan central weather bureau reported one strong quake measuring magnitude 6.7 and a series of smaller ones.

It said the stronger tremor struck at 8:26 pm (1226 GMT), with its epicenter 23 kilometres southwest of Hengchun in Pingtung county, in the southernmost tip of Taiwan. It originated 22 kilometres under the sea.

The first and second powerful aftershocks rocked Pingtung about eight minutes and 14 minutes later, with magnitudes of 6.4 and 5.2 respectively, the weather bureau said.

A third powerful one occurred at 23:41 pm with a magnitude of 5.5 and another hit almost two hours later at 01:35 am.

The Japan Meteorological Agency warned Tuesday that the earthquake could have triggered a one-metre high tsunami heading towards the Philippines, but no tsunami was reported.

Taiwan, which lies near the junction of two tectonic plates, is regularly shaken by earthquakes. The country's worst, a 7.6-magnitude quake, killed some 2,400 people in September 1999.

earlier related report
Vietnam panic after evacuation call
Hanoi (AFP) Dec 27 - Officials in Vietnam said Wednesday that there had been panic overnight after an evacuation call along parts of the coast following a tsunami warning. A major 7.1-magnitude earthquake off the coast of Taiwan set off a brief tsunami warning in the Pacific, prompting authorities in Vietnam to call for the evacuation of more than 1,500 kilometres (950 miles) of its coast.

Authorities broadcast a message on Vietnam state television and on the website of the national committee for flood and storm control saying a tsunami could hit.

"Local authorities are requested to urgently inform and evacuate people and ships along the coast," the message said.

By the time Hanoi cancelled the advice about an hour later, thousands of people had already started to move to higher ground.

"This was the first time ever such an emergency warning was issued," said Nguyen Ngoc Giai, head of the Quang Binh provincial committee on flood and storm control.

"We started evacuating about 5,000 people living in high risk areas... At first people were really panicking, but the situation got better step by step," he said.

State media said thousands also fled in Danang central industrial city. "We were watching TV when they interrupted the program and broadcast the warning. The whole family was in real panic," said a 40-year old woman who identified herself as Tiet, living in one of the city's coastal districts.

"A few minutes later, local authorities asked us to move immediately... Adults ran to the beach to bring the vessels onshore and children were sent away on taxi," she said.

"About 30 minutes later, we heard the news that tsunami would not impact Vietnam on the radio."

Two people were killed in Taiwan and at least 42 people were injured by the quake, which came on the the second anniversary of the devastating Indian Ocean tsunami that left 220,000 dead.

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