TAIPEI, Taiwan (AP) _ Governing party chief Lee Huan was named Taiwan's new premier today, succeeding Yu Kuo-hua, who has been criticized as taking an overly cautious approach to economic and political reform.

A statement from the party said Lee's appointment was unanimously approved by the 31 members of the policy-making Central Standing Committee at a regular weekly meeting chaired by President Lee Teng-hui, who had nominated Lee Huan.

Yu, 75, will continue to serve as premier until later this month when the lawmaking Legislative Yuan, which is controlled by the Nationalists, will formally approve Lee Huan's appointment.

Lee Huan, the party's 72-year-old secretary general, will name a new Cabinet but observers expect him to retain most of the present members because he helped groom them.

Yu has been criticized for his conservative policies at a time when the Nationalists are pushing a more flexible foreign policy to regain international recognization for Taiwan. Younger members of the party also consider him a liability in a parliamentary election in December.

Lee Huan was educated at Columbia University and Tankok University in South Korea and is considered among the most liberal senior Nationalist officials.

He was a close aide to the late President Chiang Ching-kuo, whose father Chiang Kai-shek led the defeated Nationalists to Taiwan in 1949 when they lost a civil war to the Communists on the Chinese mainland.

Lee has been Nationalist secretary general since 1987 and helped Chiang Ching-kuo end 38 years of martial law two years ago.

A major newspaper, the United Daily News, said in an editorial that Lee's appointment would usher in a new era of political developments in Taiwan that would ''give higher priority to political modernization than economic development.''

Analysts believe this could help Lee, 66, who became president last year when Chiang Ching-kuo died and has pursued a more pragmatic foreign policy, including the first visit by Taiwan officials to China since the Nationalists were overthrown 40 years ago.

Hu Fu, a political scientist at the Nationalist Taiwan University, questionedd whether Lee Huan would push through any drastic reforms.

''Lee Huan is not so rigid as Yu but he is not a reformer,'' Hu said. ''Liberalization will move forward steadily but gradually.''

The party statement did not say who would succeed Lee. But newspapers have said James Soong, 47, the party's deputy secretary general, is a leading candidate.