The announcement by Taiwan's President Chen Shui-bian, that he will give up some of his powers, is an attempt to try to quell mounting pressure on him to take responsibility for a series of corruption scandals surrounding his administration and family.
The move came as some opposition legislators began pushing for a recall of the president - a constitutional procedure that requires a two-thirds legislative majority and the support of at least half of Taiwan's electorate in a referendum.
Premier Su Tseng-chang is likely to gain from the move
There has also been growing criticism of the president from within his party - the Democratic Progressive Party, or DPP.
President Chen and his party came to power six years ago promising to clean up government and end corruption after more than half a century of one-party rule by the Kuomintang or Nationalist Party.
Some DPP members had voiced concerns that the scandals surrounding the president's family could distract him from his official duties. There had been calls for him to delegate more power to the Cabinet and party leaders, giving them more space to work to win back public support and implement reforms.
Lo Chih-cheng, executive director at the Institute for National Policy Research, said President Chen's announcement was an important tool of "damage control".
"It's an important turning point - for the president, the party, and the country," he said. "For the first time in six years, the president has said he is willing to share power with other people. In the past, he monopolised all the power, even on things like personnel appointments; he was very reluctant to share power", he said. "Maybe things will turn out better now because of this crisis."
Political analyst Emile Sheng, at Soochow University, said President Chen was forced to act to try to regain the support of his party.
"His role will be marginalised now," he said. "It's a very humiliating public announcement.
"But it might also be the best arrangement - a way for other elites in his party to gain."
Mr Chen's personal popularity is at an all-time low
The person who appears most likely to benefit is Prime Minister Su Tseng-chang, who is seen as the most likely person to become his party's candidate in 2008 presidential elections.
Empowering his premier could help the party distance itself more clearly from the corruption scandals.
Many expect Mr Su to push for a more pragmatic policy in dealing with China which claims sovereignty over Taiwan - especially in promoting cross strait exchanges.
But suggestions that President Chen will now be left only as a figurehead have been dismissed by his top officials.
"He still will take responsibility for the stability of the country and the future of Taiwan," said David Lee, spokesman at the presidential office, noting that the president will retain control over the key areas of national security, defence, foreign affairs and relations with China.
"He's showing he's a responsible leader; and someone who is trying to reform. He wants to unite the party; and win back the confidence of the party."
It is unclear, though, how much the president's announcement will achieve towards either goal. Editorials in many Taiwanese newspapers have reacted negatively, calling Mr Chen's move too little, too late.
Born in Taiwan
First president from DPP, after 50 years of KMT rule
Charismatic speaker with populist touch
Despised by China, which fears he wants formal independence
And despite a meeting of the DPP's Central Standing Committee, which urged the party to stand united, and speak with one voice, concerns persist.
"Many of us are confused. We have to wait and see what will happen," said one DPP lawmaker, Hong Chi-chang.
"We hope the president will still remain involved in government - he's the elected leader.
"But he needs to change his style of decision making. He needs to be more inclusive, and work with others. I'm worried he's making too many unilateral decisions."
He said he also worried that any ceding of powers to the prime minister - who was appointed by the president, and not elected or endorsed by the legislature - could create a new set of problems.
'Not over yet'
Many are also predicting that the scandals will continue to snowball.
Taipei City Mayor, Ma Ying-jeou, who is also chairman of the opposition Kuomintang or Nationalist Party and widely expected to be the party's candidate in 2008 presidential elections, told reporters this week that the current cases were just "the tip of the iceberg".
He said if it could be shown that the president or the First Lady were directly implicated, he would put his full weight behind moves to recall the president.
"We are waiting for the most opportune moment to do it," he said.
But if more corruption scandals do emerge, the big question will be: How long can the president resist calls for him to step down?