In heavy saucepan combine peaches, onion, rice vinegar, cider vinegar, sugar, chili pepper and five spice powder.
Stir in red pepper and salt (if desired). Bring to boiling. Reduce heat. Simmer, uncovered, for 35 to 45 minutes or until fruit loses its shape and mixture thickens slightly, stirring frequently.
Remove from heat. Let stand for 1 hour.
Transfer fruit mixture to bowl. Cover and refrigerate at least 4 hours.