Prime Minister Malcolm Turnbull remains hopeful America's official stance on the TPP could change, after President Donald Trump signed an executive order withdrawing any US involvement.
Australia is not giving up on the Trans-Pacific Partnership deal, despite Donald Trump effectively killing off the historic 12-nation agreement with the stroke of a pen.
The US president withdrew America from the TPP using an executive order just three days after his predecessor - and deal supporter - Barack Obama left the White House.
"We've been talking about this for a long time. It's a great thing for the American worker," Mr Trump said at the signing ceremony.
While it's a major blow to Prime Minister Malcolm Turnbull, who had been heralding the TPP as a major plank of his economic plan, he has not given up hope.
"The Republican Party in the congress have been strong supporters of the TPP," he said. "You have to recognise that [Donald Trump's] secretary of state Rex Tillerson has been a long-time advocate for it.
"It is possible that US policy could change over time on this, as it has done on other trade deals.
"There is also the opportunity for the TPP to proceed without the United States."
Mr Turnbull said he already spoke with his Japanese counterpart Shinzo Abe about it.
Both leaders agreed the deal was in the interests of both the Australian and Japanese people.
Trade Minister Steve Ciobo is keen to see if a TPP of 12 nations, minus one could work.
He has already had discussions with Canada, Mexico, Japan, New Zealand, Singapore and Malaysia about working towards an alternative.
"It's a moving space, but it's an important space, one that we must continue to pursue to give Aussie exporters the best chance to get preferential, global access for Australian exports," he told ABC radio from New York.
The Australian government would keep alive the option of ratifying the TPP even without the US.
"We're not going to be like Bill Shorten and the Labor Party and walk away from this deal because it requires now a little bit of elbow grease," Mr Ciobo said.
Opposition trade spokesman Jason Clare said Mr Turnbull's credibility was in little better shape than the "dead" TPP, with the prime minister declaring the deal was pivotal to his economic plan.
"It's over. Donald Trump has killed the TPP," Mr Clare said in a statement. "It's time for Malcolm Turnbull to wake up and move on, and develop a real economic plan for Australia."
TPP 'dead in the water': expert
Andrew Shearer from the Center for Strategic and International Studies in Washington told SBS News the TPP had been "dead in the water" for some time, and advised against any attempts to establish a major trade deal without US involvement.
"There could be something else that's kind of a pale immitation to the TPP, but without American participation it certainly won't be the TPP," he said.
"It would clearly have less impact. The United States is still the world's largest economy, the world's most dynamic economy which does the most to drive innovation."
Mr Shearer said while America's withdrawal is a missed opportunity for free trade in the region, Australia remains relatively well-placed.
"Australia already has an extensive network of bilateral free trade deals," he said. "They go back to the Howard government where we signed a free trade deal with the US, and under the Abbott government we signed free trade deals with Japan, South Korea and China. So Australia has been something of a leader in issuing bilateral deals."
Mr Trump has vowed to pursue one-on-one trade deals for the US instead of multilateral agreements.
"We are going to have trade, but we are going to have one-on-one and if somebody misbehaves we are going to send them a letter of termination - 30 days and they'll either straighten it out or we are gone," he said.
"Not one of these deals where you can't get out of them and it is a disaster."
Mr Shearer said as a result, Australia would need to be "agile".
"We'll have to be alert to the fact that the US is likely to come after markets like Japan for example where we've got an advantage because we have a bilateral FTA," he said.
"We need to make sure we're as competitive as possible and we're thinking creatively about new FTA arrangements."
Mr Shearer said by withdrawing from the deal, the United States had created a power vacuum in terms of redesigning economic architecture in the Asia Pacific.
He said China had already indicated it wanted to fill the void, but its protectionist approach to economics would prevent them from doing so.
"I don't see China stepping in to that leadership role," he said. "But I think we're going to see a tussle for influence.
"I think we're going to see a push for the US to reach out and strike more of these quick bilateral trade deals and I think we'll see China up its efforts to entice regional countries into trade deals as well and Australia is going to have to be alert to the opportunity and the risk that our competitors could get the jump on us if we're not agile and in particular if we don't make our economy more competitive."
Mr Shearer said the Australian government also needed to be realistic.
"Australia should continue to argue the case for broad-based multilateral free trade and for regional institutions that are open and liberal," he said.
"But we should also redouble our efforts to get some kind of trading agreement with India.
"We should work harder to get some kind of arrangement with Indonesia, which will over time become a more important market for Australia. And we should also be alert to opportunities, like those presented by the UK leaving the European Union."