Bank of Japan Governor Haruhiko Kuroda on Thursday called for "rational" debate among G7 nations to prevent protectionist trade measures from disrupting the global economy.
Countries that adopt protectionist measures would only see their economies suffer from disruptions in imports, as other countries would likely take counter-measures, he said.
"I don't think the tide of free trade will shift. But it's important to carry on discussion so that things don't escalate," Kuroda told reporters upon arrival for a meeting of finance ministers and central bank governors of the Group of Seven advanced economies.
"I can only say that we need rational discussions."
Fears of a global trade war are overshadowing G7 talks at the Canadian resort town, as Washington's allies vowed to push back against a US decision to impose tariffs on their steel and aluminium exports.
Unlike some other US allies, Japan had not been granted even temporary tariff exemptions. But Tokyo policymakers remain wary of pushing back too much, given its close defence ties with the United States, analysts say.
Japanese Finance Minister Taro Aso, who was also in Whistler for the G7, repeated Tokyo's request for a permanent exemption in talks with his US counterpart Steven Mnuchin on Thursday, a senior Japanese finance ministry official told reporters.
Aso also called on the United States to join forces in stopping China from taking market-distorting trade practices, the official said, a sign Tokyo wants a united front with Washington against China despite disagreement over US tariffs.
"China still takes various market-distorting trade and investment practices. There were discussions on how to bring China into the global, rule-based economic system," the official said. He added that Aso and Mnuchin did not discuss currency moves, or whether Japan and the United States should enter into talks for a bilateral free trade agreement (FTA).
The United States' allies in the G7 vowed on Thursday to push back against Washington's decision to impose tariffs on their steel and aluminium exports, saying as they gathered for a meeting that the move threatens global growth.
The escalating trade conflict between the United States and many key allies will dominate the three-day meeting in Canada, with Mnuchin the top target for their complaints and lobbying.
The United States on Thursday said it was moving ahead to impose tariffs of 25 per cent on steel imports and 10 per cent on aluminium, starting at midnight, ending months of uncertainty about potential exemptions and sending a chill through financial markets.
French Finance Minister Bruno Le Maire demanded a "permanent and total exemption" from the tariffs and said that European Union countries would respond with their own measures.
The US tariff decision "is unjustified and unjustifiable and will have dangerous consequences for global growth," Le Maire said in comments to media on his way to the meeting of policymakers from the United States, Britain, Germany, France, Italy, Japan and Canada in the mountain resort of Whistler, British Columbia.
His German counterpart, Olaf Scholz, said EU member states would show their unity and sovereignty by acting in a determined way. "Our response should be clear, strong and smart," Scholz told Reuters.
Canadian Finance Minister Bill Morneau said the tariffs would colour the G7 meeting.
"There will be some challenging discussions I’m sure," Morneau told a news conference as top policymakers gathered. "We are not saying there won’t be frictions," he added. "We’re not saying we won’t have strong words. We’re not saying we won’t be able to send messages."