A crowd chanting slogans set fire to the flag outside the de facto US mission in the southern port city of Kaohsiung and unfurled protest banners, including one that read 'Oppose US bullying of Taiwan', television pictures showed.

Police then moved in to douse the flames, but there were no reports of arrests or injuries.

'We have our president and territory, and we pay taxes to the government. Without doubt, Taiwan is a country, not what the United States said,' a protester told reporters.

The protest came after White House official Dennis Wilder said last week that Taiwan was not a state and so could not become a member of the United Nations.

The UN General Assembly will discuss Taiwan's membership application later this month. Its past efforts to join the UN have been repeatedly blocked by Beijing.

The island's ruling Democratic Progressive Party wants to hold a referendum on UN membership next year.

AGENCE FRANCE-PRESSE