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China, Israel Foreign Ministers Meet

March 25, 2002

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BEIJING (AP) _ Israeli Foreign Minister Shimon Peres met with his Chinese counterpart on Monday on day two of a visit aimed at repairing ties fractured by an arms sale dispute.

Peres is the first high-ranking Israeli official to visit following the resolution of problems over Israel’s last-minute cancellation of a deal to sell China an advanced airborne radar system known as PHALCON.

``We don’t expect it to be raised. It’s over,″ Israeli Embassy spokesman Amir Sagie said. ``This visit is in order to open a new page.″

Peres was greeted by Chinese Foreign Minister Tang Jiaxuan at the ministry. Tang said ties and cooperation have grown ``relatively fast″ in the decade since the countries established diplomatic relations.

``Compared at least to what we used to have in the past, the economic ties and exchanges of two-way trade have remarkably increased and are mutually beneficial,″ he told Peres.

Peres made no comments before reporters were ushered from the room.

Sagie said discussions were expected to focus on China-Israel relations and Middle East peace efforts. China has traditionally backed Palestinian calls for an Israeli withdrawal from the West Bank and Gaza, but has not been directly involved in peace efforts.

Earlier, Peres met with Chinese academics specializing in the Middle East and arms control and attended the launch of a Chinese language version of his book ``New Genesis.″

On Tuesday, Peres is expected to meet with Chinese Premier Zhu Rongji before returning to Israel.

Israel scrapped the PHALCON deal in August 2000 under pressure from the United States, which said the system would increase the threat to Taiwan and could endanger American pilots in case of a war with China.

Israeli officials this month said a compensation agreement had been signed. An Israeli newspaper reported that Israel agreed to pay China $350 million, far less than the $1.2 billion China originally asked for.

The feud sent a chill through relations. In January, Chinese President Jiang Zemin sent Palestinian leader Yasser Arafat an unusual letter of support criticizing Israel’s military attacks and economic blockade against Palestinian territories.

The same month, China snubbed Israel by downgrading a reception marking the anniversary of the establishment diplomatic ties. China moved the event from the seat of the national legislature to an obscure government compound and sent only low-level officials to attend.

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