(Adds police dispersal of crowds)

TAIPEI, Nov 6 (Reuters) - About a thousand protesters surrounded a hotel in Taiwan's capital, where Chinese negotiator Chen Yunlin held a meeting on Wednesday, to protest against closer ties between the two political rivals.

Hundreds of riot police stopped the protesters from various political groups getting into the Formosa Regent hotel in central Taipei for more than seven hours, blocking traffic until early Thursday morning and causing minor scuffles.

"China is China. Taiwan is Taiwan. We have a Chinese bandit on our territory and we need to resist," Taipei resident Chang Shaoming, 50, said at the protest.

Columns of riot patrol officers dispersed the crowds early on Thursday, clashing with some protesters who hurled plastic bottles and pieces of food.

During the protest, Chen was in the hotel, unable to leave safely, local television reported.

It was unclear whether he eventually left, but a staff member at another hotel where he was staying, elsewhere in Taipei, said he had returned around 2:30 a.m.

China has claimed sovereignty over self-ruled Taiwan since 1949, when Mao Zedong's Communists won the Chinese civil war and Chiang Kai-shek's Nationalists (KMT) fled to the island. Beijing has vowed to bring Taiwan under its rule, by force if necessary.

But China-friendly Taiwan President Ma Ying-jeou has pushed for landmark trade and transit ties since he took office in May.

Officials from the two sides signed deals on daily direct air flights, new cargo routes and food safety on Tuesday during Beijing's highest-level visit to its political rival in 60 years.

"This irrational act severely ruins Taiwan's international image," Taiwan's Straits Exchange Foundation, the island's agency in charge of negotiating with China, said in a statement about the protest. (Reporting by Ralph Jennings; editing by Michael Roddy)

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