Israel and China established diplomatic relations on Friday, and Israel's foreign minister said the ties could reduce arms sales to the Middle East.

The move also clears the way for China, a longtime champion of the PLO and Palestinian rights, to join in Middle East peace talks.Israel is the latest country with which the Communist power has established or normalized ties in the past 11/2 years. The other nations include Saudi Arabia, Indonesia, Singapore and Vietnam, and China has made overtures toward establishing ties with South Korea and South Africa.

China, which also recognizes the state of Palestine declared by the Palestine Liberation Organization, already has announced it plans to send a delegation to Moscow to join in next week's round of peace talks.

Although Israel unilaterally recognized China in the 1950s, China had never before recognized the Jewish state.

Foreign Minister David Levy of Israel and his Chinese counterpart, Qian Qichen, signed a protocol establishing relations in a ceremony in the Diaoyutai State Guesthouse, where the officials also held nearly two hours of private talks.

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"We have discussed the arms race and know that it is in contrast to the peace process," Levy said after the talks, with Qian at his side.

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