A commerce ministry spokesman announced last week that China will immediately implement the consensus both China and the U.S. sides already reached on agricultural products, energy, autos, and other specific items. These declarations came out after the discussions between presidents Donald Trump and Xi Jinping concluded that they would give 90 days to negotiators to figure out their trade spat. Both sides stated that they would also discuss intellectual property protection, technology cooperation, market access, and fair trade. However, there have been no clarifications regarding the measures that will be taken in order to maintain the agreement conditions, causing stock markets to destabilize.
We assess that this will be a relevant matter for all clients operating in both countries or buying products from them in the near to long term as the measures are likely to be implemented immediately and would continue in order to keep the agreement. Until the conditions of the agreement are announced, it is possible that stock markets will continue to fluctuate. We recommend all clients to consider this situation before making any investment in the affected industries and to stay informed about any official declarations in order to anticipate the effects that the agreement will have.
The Qatari government announced last week that they are leaving the Organization of the Petroleum Exporting Countries, or OPEC. This announcement comes shortly before a meeting at the organization's headquarters in Vienna. The withdrawal of the country will be effective on January 1, 2019. Qatar explained that its government wants to increase the production of liquefied natural gas by more than 50%, creating an independent industry. Some specialists stated that the country's decision to withdraw from OPEC is due to the historical tensions with Saudi Arabia; however, the Qatari Energy Minister denied that version.
We assess that the announcement of the Qatari withdraw from the OPEC is unlikely to affect oil prices worldwide given that it is a small producer within the organization. However, we find it likely that the exit of Qatar will question the efficiency of the international organization to be able to go beyond political or economic divisions. Two years ago, the OPEC allied with non-members to control oil production, since then Russia has been an ally of Saudi Arabia regarding oil production. If smaller OPEC countries follow the example of Qatar, it is highly likely that Saudi Arabia and Russia will have a key role in determining oil prices worldwide due to the lack of counterbalance those countries could have in OPEC in the long term. We recommend clients follow developments with the Qatari departure, especially if OPEC applies measures against Qatar that affect the oil markets. We advise clients in the oil industry or heavily relying on the resource, to analyze the situation and to adjust business plans to the new and likely fluctuating oil prices.
And in our last story this week, French President Emmanuel Macron announced the end of further fuel-tax hikes for inclusion in the coming budget following largescale protest activity last week. The move comes as the government seeks to end widescale, violent protest activity against rising living costs. In addition, the government announced an amendment to a wealth tax seen as prioritizing the wealthy. In addition, recent analysis by the Organization for Economic Co-operation and Development OECD showed that France is the most highly taxed country in the developed world. Further, alongside student protests, trade unions conducted strike action. Further strikes in the energy sector and at ports have been announced for December 13. Total, a fueling station company, reported that many of its stations were low on fuel following roadblocks.
Despite the concessions, we find it likely that further protests will occur in the short term. As the government is considering deploying troops currently tasked with anti-terrorism patrols to protect public buildings, we find it likely that clashes between demonstrators and security forces will occur. We further find it likely that the government will institute further concessions as a means of quelling the unrest. Current polling in France indicates 72% of the population support the protest activity against Macron's policies, but 82% condemn the violence. Due to the high support, we find it likely that protest activity will continue over the medium term. We further find it likely that the French government will consider reducing taxes over the long term.