With its advantages, the agreement is capturing great attention from other APEC countries that do not want to be left behind in this dynamic economic region.

The TPP, which was put forward by US President Barrack Obama at the 17th APEC summit in Singapore in 2009, is being negotiated by Australia, Brunei, Chile, New Zealand, Malaysia, Peru, Singapore, the US and Vietnam.

While attending the 19^th APEC summit in Honolulu, Hawaii earlier this week, the leaders of these nine countries reached a consensus on the broad outlines of the agreement, which will help enhance trade and investment, spur economic growth and generate jobs.

Specialists say once negotiations conclude, the TPP will pave the way for developing a free trade area in the Asia-Pacific region (FTAAP) in the near future.  

By joining the TPP, the member countries will have comprehensive access to each other’s markets, with tariffs and other barriers to goods and services being eliminated which will create new opportunities for workers and businesses and bring immediate benefits to consumers.

A fully regional agreement will be reached to facilitate production and supply chains among TPP members, aiming to create jobs, raise living standards, improve welfare and promote sustainable growth in member countries.

The agreement will build on work being done in APEC and other forums by incorporating four new cross-cutting issues, namely regulatory coherence, competitiveness and business facilitation, small- and medium-sized enterprises, and development.

It will promote trade and investment in innovative products and services, including those related to the digital economy and green technologies, and ensure a competitive business environment across the TPP region.

The leaders of the nine countries agreed that the TPP will be a living agreement, which can be updated to address trade issues that emerge in the future as well as new issues that may arise when the agreement is expanded to include new countries.

Experts believe that the TPP will be the precursor to many future free trade agreements dealing with trade and investment liberalisation, as well as new and emerging issues. .    

It is worth mentioning that the nine TPP countries are dynamic economies on their three continents, accounting for one fourth of the global GDP worth US$16 trillion and a large market of 472 million consumers.

Given its great potential, the TPP is attracting many countries because they can see both immediate and long-term economic benefits from the agreement, which could help them deal with the current global economic downturn.

The TPP will create new markets for the US, helping revitalise its sluggish economy and generate jobs. Meanwhile, Japan – the third largest economy in the world – has decided to take part in TPP negotiations, realising that a large free market will help its leading industries to thrive. Once import tariffs are slashed to zero percent, Japanese products such as cars, televisions, machinery and electronics will penetrate this large market more deeply.

However, the TPP will also pose new challenges to its member countries where several economic sectors are subsidised by the governments. For example, the agricultural sector in Japan will have to face fierce competition when tariffs are cut to zero percent.

The TPP is considered a strategic agreement which means participating countries are playing an important role in regional policymaking. Besides Japan, several other countries have also expressed a desire to participate in negotiations, demonstrating their determination to fully tap this lucrative market.