The TPP first was first initiated with a trade agreement—then known as the Trans-Pacific Strategic Economic Partnership Agreement—signed in 2006 between Brunei, Chile, New Zealand and Singapore. The year 2008 saw an additional eight countries joining in for a broader agreement to make the 12 countries involved today: Australia, Canada, Japan, Malaysia, Mexico, Peru, US, Vietnam.

The TPP seeks to lower trade barriers such as tariffs and establish a common framework for intellectual property, standards for labour and environmental laws, as well as an investor-state dispute settlement mechanism. By this, it hence aims to enhance trade and investment among the partner countries, promote innovation, economic growth and development, and support the creation and retention of jobs.

The partnership today is led by the US and Japan, and aims to set rules for 21st century trade and investment, and to pressure China (not one of the 12) to shape its behaviour and conform to TPP standards.

With the 12 countries accounting for a total population of 800 million and representing 40 percent of world trade, the TPP is definitely a trade deal on a humungous scale and its benefits are numerous.

For instance, the partnership would smooth out the existing creases and barriers to international trade, such as Japanese regulations to keep out some American-made autos and trucks or beef, or Canadian regulations on import of dairy products to protect their farmers, and it would also help to open new markets like the Internet in Vietnam.

An estimated 18,000 tariffs are expected to end in the long-term with the partnership among the 12 countries, and this would help the individual countries produce and export their specialised goods and services efficiently while continuing to import from others. In the future, this could help modestly decrease retail prices for consumers.

For the moment, the conclusion of the TPP among the leaders of the 12 countries is an important first step, but the deal still has to be ratified by lawmakers in each country before it can fully proceed.