YOKOHAMA, Japan — Pacific Rim leaders sought Saturday to smooth divisions over currency policies and other issues, shifting their attention to their shared goal of working for freer trade for the sake of future growth.

President Barack Obama and other leaders attending the annual meeting of the Asia-Pacific Economic Cooperation forum pledged not to backslide into retaliatory trade tactics, a day after discord over such issues marred a summit, held in South Korea, of the Group of 20 major economies.

"We will liberalize our trade," Japanese Prime Minister Naoto Kan told a business conference on APEC's sidelines. "The United States is looking to expand trade and commerce throughout the Asia-Pacific," Obama said. "The international community should oppose protectionism in all manifestations," said Chinese President Hu Jintao.

The emphasis at APEC, where congeniality usually trumps conflict, is on a common mission of eventually forging a vast regionwide free trade zone that would encompass all 21 member economies, accounting for more than half of all global commerce.

But much of APEC's work occurs in face-to-face encounters outside the summit, held in the port city of Yokohama. Kan took the opportunity to hold his first formal meeting with Hu since a territorial dispute erupted two months ago, badly straining ties between the Asian neighbors.

The two leaders both expressed their positions on the issue, and agreed developing strategic relations between the two countries would benefit not only the two sides but also the region and the world, said Japan's deputy chief Cabinet secretary, Tetsuro Fukuyama.

"The formal bilateral talks mark a major step forward to improving Japan-China relations," said Fukuyama, who did not elaborate on whether the two made any progress toward reconciling their differences.

Kan also met with Russian President Dmitry Medvedev, who recently angered Tokyo by visiting an island off its northern coast that both nations claim. Though both said the talks should help reinforce trust, afterward Fukuyama explained that Kan told Medvedev his visit was "unacceptable" and had insulted the Japanese.

Relations between Tokyo and Beijing have been soured by the collision of a Chinese fishing trawler with two Japanese coast guard vessels near disputed islands east of Taiwan, an incident that has provoked protests on both sides.

Outside the heavily guarded APEC venue thousands of anti-China demonstrators rallied Saturday, waving big Japanese flags and placards with slogans such as "Defend our territory," and "Defeat Chinese imperialism."

"I think China is a threat to Japan," said Sayo Kuroda, a 19-year-old college student whose family joined the protest.

Many in Japan and elsewhere in the region are looking to the U.S. to be a counterweight for China's growing influence and sometimes aggressive stance.

"We have had various problems in our relations with Russia and China, and I thank President Obama for his support," Kan said, noting Tokyo's awareness of the important role played by the U.S. military, which has 50,000 troops in Japan under a 50-year-old security treaty.

After meeting with Obama, Australian Prime Minister Julia Gillard likewise noted their countries' shared "strategic objectives."

"As China rises, obviously, we want to see China be a force for good in the world," she said.

Obama reaffirmed America's commitment to pursuing closer ties with the region that has helped power the world's recovery from the global financial crisis, in trade as well as in broader areas of defense and diplomacy.

Asia's robust and resilient growth has hinged on trade, and the U.S. is keen to tap into that dynamism, Obama said.

"In this region the United States sees a huge opportunity to increase our exports to some of the fastest growing markets in the world," Obama told the APEC business conference. "For America this is a jobs strategy."

Obama praised Kan for pledging to further open Japan's sluggish economy to trade and investment, despite protests from farmers who fear the loss of subsidies and protective tariffs.

Though about half the leaders from the G-20 meeting traveled on to Yokohama, there was no sign that the ill-will shown in Seoul had carried over to the APEC summit.

Currency issues did, however, appear to get more attention than they usually do at APEC.

The leaders' draft statement notes a need to reduce trade imbalances and government debt to help ensure stable and sustainable economic growth. It also includes a pledge to move toward more "market-determined exchange rate systems."

"I think we could say that we have averted a competitive devaluation and currency wars for now ... But I think it's not something that we have altogether overcome yet," said Indonesia's Trade Minister Mari Pangestu.

Associated Press writers Jim Gomez, Eric Talmadge, Tomoko A. Hosaka, Malcolm Foster and Mari Yamaguchi contributed to this report.