(Raises number evacuated, adds school closures)

SHANGHAI, Sept 18 (Reuters) - A powerful typhoon targeted China's booming eastern province of Zhejiang and the nation's financial capital, Shanghai, on Tuesday, prompting evacuation of over 1.6 million people as ships were recalled to port.

Typhoon Wipha was about 300 km southeast of Wenling city at 0800 GMT. With gusts of up to 198 km per hour (123 mph), it was moving northwest at 25 to 30 km per hour and should make landfall in the early hours of Wednesday, Xinhua news agency said.

"East China, including the commercial hub of Shanghai, is preparing for what may be the most destructive typhoon in a decade," the agency said.

The intensity of the typhoon was close to that of Saomai, which killed more than 400 people in China last August and was labelled the strongest storm to hit the country in 50 years, said Chen Hongyi, deputy chief of the meteorological bureau in the coastal city of Taizhou, Xinhua reported.

China's National Meteorological Centre described the storm on its Web site (www.nmc.gov.cn) as a "super typhoon".

By Tuesday evening 1.63 million people in Shanghai, Zhejiang and neighbouring Fujian province had been evacuated, Xinhua said. Shanghai and surrounding cities had ordered all schools to close.

"Wipha will hit our province head on and the areas affected would be the most economically developed and densely populated," the Zhejiang provincial government warned.

"Strong winds will come with heavy rainfall ... The relief work will be complicated and grave," it said in a statement on its Web site (www.zj.gov.cn).

ZOO, OIL RIG BUNKER DOWN

Tens of thousands of boats and ships had returned to harbour in Zhejiang, where beach resorts and sea farms were evacuated and ferry services suspended, state media said. Some 365 workers were also pulled off the Pinghu oil rig in the East China Sea.

Shanghai faced its most severe test in decades, the deputy head of the city's flood control headquarters said.

By late Tuesday some streets were blocked and traffic slowed to a crawl in older areas of the city centre, as flooding in some places reached levels of nearly a metre, and underground car parks were inundated.

Two zoos in the city caged their animals to prevent any making escape bids along fallen trees, cut off power supplies to prevent fires and boosted staffing.

Zhejiang's inland areas also faced the threats of floods and landslides caused by torrential rain. By Tuesday evening, some rivers and reservoirs had risen to warning levels, Xinhua said.

The edge of Wipha grazed northern Taiwan on Tuesday, bringing downpours and prompting closure of schools, offices and markets.

The major northern port of Keelung halted all traffic on Tuesday until further notice. Five airlines cancelled some international flights.

Typhoons, large cyclones known as hurricanes in the West, regularly hit China, Taiwan, the Philippines and Japan in the summer season, gathering strength from the warm waters of the Pacific or the South China Sea before weakening over land.

Sometimes they can make a u-turn, gather strength at sea again, and return to wreak more havoc.

AlertNet news is provided by