A typhoon inched across northern Taiwan on Thursday after already dumping heavy rain that has flooded farmland, swollen rivers and paralyzed life on much of the densely populated island of 23 million people.

Typhoon Saola weakened to a strong tropical storm by late afternoon, but its slow movement and continuing heavy rains raised the prospect of devastating flooding in areas that have absorbed more than 150 centimetres of rain since Tuesday.

It has caused five deaths and left two people missing in Taiwan, after 26 people were killed in the Philippines earlier this week.

Earlier in the day in the northeastern county of Ilan, rescuers were using rubber boats and amphibious vehicles to help hundreds escape flooded homes. They were also seeking to locate at least six stranded residents, cut off from the rest of their farming community when flood waters overwhelmed a small bridge.

A car sits in flood waters from approaching Typhoon Saola in suburban Taipei. (Wally Santana/Associated Press)

Dozens of flights were cancelled at Taipei's main international airport, where heavy winds destroyed two jetways, and rail transport throughout the island was disrupted. All seven major reservoirs in Taiwan released large quantities of water in a flood prevention measure.

By late afternoon, Saola was centered just off the northern Taiwanese coast, moving west toward China at 14 km/h. It had sustained winds of 108 km/h gusting to 137 km/h.

Offices, businesses closed

Offices and businesses were closed throughout northern Taiwan, including in Taipei. Normally busy streets in the capital were deserted except for cleanup crews clearing off trees and branches felled by the storm overnight. The Defence Ministry mobilized 48,000 soldiers to help mitigate the storm's impact.

Television footage showed acre upon acre of flooded farmland in low-lying coastal areas, punctuated by scenes of raging rivers and roads blocked by mudslides in the island's mountainous center.

The typhoon left at least 26 people dead in the Philippines and forced 180,000 to flee their homes in the capital, Manila, and 27 central and northern provinces. Coast guard and other disaster-response groups rescued 125 people from stricken sea vessels and flooded villages, according to Benito Ramos, who heads the government's National Disaster Risk Reduction and Management Council.