The role of government healthcare financing in carbon emissions and climate change

ABSTRACT

Government financing among OPEC+ countries predominantly stems from oil investments. However, given the global prevalence of communicable and non-communicable diseases, aging, population growth, and pandemic mutations, these countries require more oil investments to finance healthcare, with potential adverse consequence on carbon emissions and climate change. This study aims to investigate the relationship between government healthcare financing and carbon emissions and climate change and propose solutions for greener healthcare financing. Quantitative data from 2000 to 2020 were extracted from the WHO and Global Economy databases. The relationship of four variables indicating government healthcare financing to government budget, to total healthcare financing, to GDP, and per-capita with oil investment were investigated using a multiple regression analysis. The analysis included the world’s ten oil-producing countries with the highest oil revenue to GDP. The results showed significant relationships between government healthcare financing to total healthcare financing, to GDP, and per-capita with oil investment among most of the included countries, thereby demonstrating the substantial contribution of OPEC+ to carbon emissions and climate change. The predominant dependence of OPEC+ on oil for financing, with no tangible future transition insight, should make them persistent contributors to carbon emissions and climate change given the considerable publicly financed part of their healthcare systems and the world’s changeable healthcare needs. Thus, oil-dependent countries should strive to free their healthcare financing from oil investment with the environmental harm that this coupling incurs and adopt transformative strategies that expedite the transition to net-zero carbon emissions.

Highlights

Oil-dependent countries boost oil investments to meet global healthcare demands, which could negatively affect carbon emissions and climate change.

The relationship between government healthcare financing and oil investment in OPEC+ countries was investigated.

Most countries and variables showed associations between government healthcare financing and oil investment.

OPEC+ appeared to significantly contribute to carbon emissions and climate change.

KEYWORDS:

• carbon emissions
• climate changes
• OPEC+
• healthcare financing

JEL CLASSIFICATION:

• H51
• H61
• H72
• H75
• I18

View correction statement:

Correction

1. Introduction

Oil has been the world’s major commercial energy source and the engine of the massive economic advancements observed in the past decades (Azam et al., 2019; Lee et al., 2022). The high dependence on oil revenue, which accounts for 5% to above 30% of many countries’ gross domestic product (GDP), was evident (The Global Economy, 2023b). These revenues considerably contribute to governments financing sourced in different ways, such as government-owned oil companies, and taxing oil companies, with many countries’ taxing percentages as high as exceeding 50% (Tax Foundation, 2022). Financing could also be sourced from fuel consumption taxes, reaching $2 per gallon in many countries and exceeding $3 in others (U.S. Department of Energy, 2019).

The current high reliance on oil as a major source of energy with the view that it would continue to maintain its dominant role in future energy consumption potentially exacerbate its impact on global public health and climate change (Lee et al., 2022), despite the acknowledged necessity of oil in various forms for healthcare provision (Azam et al., 2019). Carbon emissions from oil are a particular global concern (Rajabi et al., 2020), owing to the direct threat they pose to human life by exacerbating existing diseases and creating new health threats over the long term (Centers for Disease Control and Prevention, 2022; Chaudhry et al., 2020). Indirect influence to human health comes from climate change, resulting in extreme weather events, increased heat, food insecurity, and pollution of air, water, and soil (Centers for Disease Control and Prevention, 2022; Chaudhry et al., 2020). Upon acknowledging this issue and with the aim to tackle its associated negative impact, world leaders reached the Paris Agreement—an international binding agreement among 195 countries to reduce their emissions with a commitment to strengthen their reductions over time and reach net-zero emissions (Dimitrov, 2016; Seo, 2017). In addition, countries including educational, financial, and research institutions have joined the race to contribute to this mission.

The increased demand for healthcare resulted from the prevalence of communicable and non-communicable diseases (Emadi et al., 2021), ramification of different pandemic mutations (Amoutzias et al., 2022; Lazebnik & Blumrosen, 2022), global aging, and population growth, all of which require substantial healthcare financing (Jakovljevic et al., 2022). The imperative to meet these healthcare challenges, alongside the human right to adequate healthcare access (World Health Organization, 2023e), might make government healthcare financing in oil-dependent countries a substantial contributor to carbon emissions and climate change (hereafter referred to as CECC). In particular, government healthcare financing accounts for 3–6% of the GDP in many of the world’s highest oil-producing countries (The Global Economy, 2023b; World Health Organization, 2023c)—a coalition known as OPEC+ and formed in 2016, which comprises the Organization of Petroleum Exporting Countries (OPEC) and ten other big oil-producing countries (Energy Information Administration, 2023). This percentage portrays government healthcare financing as a substantial contributor to CECC. However, the extant literature has not identified whether government healthcare financing is a major contributor to CECC.

In the literature, the effect of financing on CECC has been broadly investigated, with a large number of studies investigating the effect of financial development on CECC (Adom et al., 2018; Bekhet et al., 2017; Charfeddine & Kahia, 2019; Shen et al., 2021; Wang et al., 2020). Researchers have also focused on examining the effect of financial stability and instability on CECC (Baloch et al., 2018; Nasreen et al., 2017). In addition, a rich body of literature has explored diverse financial aspects affecting CECC, such as the impacts of financing innovation (Nguyen et al., 2020), land finance (Zhang & Xu, 2017), financial performance of fossil fuel (Gonenc & Scholtens, 2017), debt (Bese et al., 2021), and financial inclusion expressed in people and business having access to different financial products and services (Le et al., 2020). Despite these contributions, evidence of the effects of government healthcare financing on CECC remains scarce.

An in-depth exploration of the literature revealed numerous studies investigating the effect of different areas and variables on CECC. For example, the petroleum industry’s effect on the levels of CECC has been investigated (Sadik-Zada & Gatto, 2021), with a greater analysis addressing the negative environmental impact of fossil fuels, coal, and natural gas consumption (Mahmood, 2022a). Moreover, the role of nuclear energy on emissions and the shift to nuclear energy has been tested in different countries (Mahmood, 2022b; Nathaniel et al., 2021). The effect of manufacturing activities on CECC was also examined (Liu et al., 2019), in addition to the potential of manufacturing industries to transfer emissions between countries (Wang et al., 2020). Some studies have highlighted the high risks that transportation emissions pose for air quality (Dobrzyńska et al., 2020), and the effect of economic growth on emissions (Yusuf et al., 2020). Others have investigated the association between environment quality and economic growth in the context of the environmental Kuznets curve hypotheses (Mahmood, 2020; Mahmood et al., 2023). Several studies have analyzed the impact of population growth (Mohsin et al., 2019; Padhan et al., 2020) as well as the effects of temperature, rainfall, and forestry production on CECC (Rehman et al., 2021). In addition, the literature has also addressed the impact of transitioning to renewable energy on the environment (Erdogan et al., 2020; Gyamfi et al., 2021; Kutan et al., 2018), and the relevant implementation challenges that require substantial research and development activities, a wide range of investments, government subsidies, and incentives to the market (Mahmood et al., 2023; Nathaniel et al., 2021). Other related topics have also examined the effect of substantial world shocks such as COVID-19 (Lyon et al., 2021; Habib et al., 2021), the 2008 financial crisis (Acar & Lindmark, 2017; Sadorsky, 2020; Zhou et al., 2018), and oil price declines (Zou, 2018) on CECC.

In fact, the literature has provided a comprehensive view of the factors affecting CECC, even examining the effect of financial market development (Mahmood, 2020, 2023), foreign direct investment (FDI) (Mahmood, 2020; Malik et al., 2020; Nguyen et al., 2020), international trade openness (Mahmood, 2020; Mahmood et al., 2023), export and import (including the net effect of trade) (Mahmood, 2023), and stock market (Wen et al., 2020). Some studies have delved into topics related to artificial intelligence (Bhowmik et al., 2018; Sharma, 2020), different technologies (Kemp & Ravikumar, 2021; Li & Li, 2021), electric cars (Holmberg & Erdemir, 2018; Knobloch et al., 2020), and many other topics. However, despite these valuable contributions, evidence on the effect of government healthcare financing on CECC is lacking. This knowledge gap offers the opportunity to address a novel combination of healthcare financing and CECC. Examining this relationship, which has not yet been investigated, is expected to make a substantial contribution to the literature, especially at a time when countries are striving to uphold their commitment to net-zero emissions. Moreover, this investigation opens new avenues for understanding the complexity of interactions between healthcare financing and CECC. It provides knowledge to policymakers with regard to environmental threats and understanding the need for comprehensive approaches on healthcare financing to make informed decisions that protect human lives, ecosystems, and critical infrastructure and reduce the devastating impact on communities and landscapes. Therefore, this study aims to investigate the relationship between government healthcare financing and CECC and propose solutions for greener healthcare financing.

The healthcare systems of OPEC+ countries are financed differently. For example, the healthcare system in Russia is financed by government budget, compulsory medical insurance funds, voluntary health insurance, and patient payments (Faiberg & Shcherbakova, 2021). In Saudi Arabia (SA) and Oman, the government finances the entire healthcare services provided to citizens, non-nationals public employees, and their dependents, while private employers finance the healthcare services of their employees and dependents (Al Mustanyir et al., 2022; Ministry of Health, 2014). In the United Arab Emirates (UAE), the government mainly finances the system, although private insurance has a larger role in Dubai and Abu Dhabi (Andersen, 2013; Koornneef et al., 2017). In Iran, the healthcare system is financed by public funds, social health insurance, private health insurance, and out of pockets (OOP) (Dizaj et al., 2019; Zare et al., 2014). In Kuwait and Algeria, the healthcare system provides free services to all citizens and is financed by the government (Alkhamis et al., 2014; Expat Financial, 2022; Scherer et al., 2018). In Angola, the healthcare system is financed by nongovernmental organizations, donors, private companies, and the government (Craveiro & Dussault, 2016; International Trade Administration, 2022a). In Qatar, the healthcare system provides universal coverage to all permanent and temporary residents and is financed either by the government or private health insurance (World Health Organization, 2018). In Kazakhstan, healthcare services are financed by federal and local budgets, with high OOP (Doskeyeva et al., 2018).

2. Methodology

The theoretical framework underpinning this study, encompassing both economic and environmental factors (Awodumi & Adewuyi, 2020; Hasanov et al., 2020), allows to investigate the relationship between government healthcare financing and CECC. By incorporating different government healthcare financing as independent variables (Al Mustanyir, 2023; Loughnane et al., 2019), the study acknowledges the complex interplay between financial allocation, healthcare priorities, and overall economic performance in addressing CECC (Doğan et al., 2021). The inclusion of CECC as the dependent variable reflects a recognition of the growing concern regarding the environmental consequences of economic activities (Mahmood, 2020), particularly in countries heavily reliant on oil production (Al Mustanyir, 2022). The study methodology involves applying quantitative methods from the field of econometrics to analyze how changes in government healthcare financing variables are associated with CECC. This framework highlights the need for sustainable healthcare systems that take into account any negative implications on CECC and the role of public policy in mitigating the risks posed to the environment (Fawzy et al., 2020; Markkanen & Anger-Kraavi, 2019). By applying this framework, the study provides empirical evidence and statistical insights into the financial aspects of healthcare and its links to CECC in oil-producing nations. Through this comprehensive approach, the research aims to inform evidence-based policies that strengthen environment resilience and address government financing impacts.

There are several methods to analyze a country’s contribution to CECC, one of which involves examining the revenues generated from a country’s oil investments. Accordingly, to align with the focus of this study on government healthcare financing and to better capture its relationship with CECC, countries’ oil investment reflected in their revenues from oil production was used as the study’s dependent variable. Moreover, four independent variables were included in the study to explain government healthcare financing: government healthcare financing to government budget, government healthcare financing to total healthcare financing, government healthcare financing to GDP, and government healthcare financing per-capita.

The inclusion of these variables serves several purposes, such as enabling aggregation, which allows for the investigation of various explanatory variables and institutional systems, thereby facilitating comparison among countries (Gerdtham & Jönsson, 2000). This contrasts with the use of absolute values, which permits the investigation of specific healthcare systems or illnesses (Turner, 2017; Zhang et al., 2010). These variables also have the capacity to reveal proportional changes in government healthcare financing even when the absolute value of the variable remains constant. Previous studies investigating different healthcare purposes have also employed these variables, including government healthcare financing to government budget (79 (Keehan et al., 2017), to total healthcare financing (Himmelstein & Woolhandler, 2016; Khan et al., 2020), to GDP (Coccia, 2021; Kiross et al., 2020; Wagstaff et al., 2018), and per-capita (Alhassan et al., 2021; Chang et al., 2019; World Health Organization, 2023b).

While all four variables center on government healthcare financing, each measures different aspects of healthcare. For instance, the government healthcare financing to total healthcare financing indicates whether a system is predominantly public or private (World Health Organization, 2023d). This differs from government healthcare financing per-capita, which shows financing density among the population (World Health Organization, 2023a). Both contrast with government healthcare financing to government budget, which reflects the weight of healthcare financing within the government budget (Gerdtham & Jönsson, 2000), and government healthcare financing to GDP, which also reflects the weight relative to the country’s wealth (World Health Organization, 2023d).

Government healthcare financing data were drawn from the World Health Organization’s (WHO) Global Health Expenditure Database, covering the available period from 2000 to 2020 at the time of the study (World Health Organization, 2023c). Data on countries’ oil investments were obtained from the Global Economy Database for the same period (The Global Economy, 2023b). These two databases were used owing to the comprehensive data on healthcare financing and oil revenues they provide on various countries around the world and for several years or decades. They also provide standardized data over time, allowing to analyze different government healthcare financing variables in the context of CECC.

To ensure more accurate results, this study sample included only those countries with accessible data on the four government healthcare financing variables for the specified period. The inclusion of countries was also contingent on high oil production levels to appropriately interpret the contribution to CECC. Thus, countries producing a minimum of one million barrels of oil per day in 2019 were included, with 2019 being chosen as a stabilized year prior to the COVID-19 outbreak (Buszko et al., 2021). Additionally, to provide a more accurate interpretation of CECC, the study only included countries that maintained an oil revenue-to-GDP ratio of at least 5% throughout the study period. Based on these criteria, ten countries were included—Russia, SA, the UAE, Iran, Kuwait, Kazakhstan, Qatar, Angola, Algeria, and Oman—all of which are members of OPEC+ except for Qatar, which ended its membership in 2019 (Energy Information Administration, 2023; OPEC, 2023).

The study tested the relationship between governments healthcare financing and countries’ oil investments using multiple regression analysis. The test was chosen for its ability to interpret the strength of the relationships between a dependent variable’s outcome and various independent variables (Khadka et al., n.d.; Petchko, 2018). This type of analysis also indicates the significance of the relationship for each independent variable while statistically eliminating the effect of the other independent variables (Briones et al., n.d.). Moreover, a two-sided t-test was performed, with significances levels at 1%, 5%, and 10% noted in the results. Statistical analysis was conducted using STATA software version 14.0.

This approach was found appropriate for investigating government healthcare financing among countries (Al Mustanyir, 2022, 2023). It was also found suitable for understanding the intricate relationship of different healthcare financing variables with oil investment as it accommodates the complexity of this number of variables and accounts for various influential factors simultaneously. Moreover, the databases’ reliability and the inclusion of only OPEC+ nations enhance the credibility and generalizability of the findings. In addition, the analysis can offer valuable insights for policymakers, aiding in resource allocation and healthcare planning, especially in the context of CECC. Although these study criteria have excluded some of the biggest polluters, such as China, the United States, and the European Union, these countries’ oil revenue-to-GDP ratio was low; nevertheless, their contribution to CECC in the context of manufacturing countries could be investigated in future research. Overall, the adopted methodology provides a sound framework for investigating the relationship between healthcare financing and CECC.

3. Results

The results of the study indicated a significant positive relationship between government healthcare financing to government budget and oil investments in Russia, Qatar, and the UAE (p = 0.03 and coefficient 1.41, p = 0.10 and coefficient 2.31, and p = 0.04 and coefficient 3.50, respectively; see Table 1). Moreover, these three countries showed a significant positive relationship between government healthcare financing to total healthcare financing and their oil investments (p = 0.00 and coefficient 0.77, p = 0.00 and coefficient 1.02, and p = 0.00 and coefficient 0.45, respectively). On the other hand, government healthcare financing to GDP was found to have a significant negative relationship with oil investments in these countries (p = 0.00 and coefficient −6.71, p = 0.02 and coefficient −9.94, and p = 0.00 and coefficient −17.51, respectively). Similarly, government healthcare financing per-capita in Russia and Qatar showed a significant relationship with oil investments (p = 0.01 and coefficient −0.00, and p = 0.00 and coefficient −0.02, respectively), while in the UAE, a significant positive relationship was found (p = 0.00 and coefficient 0.02).

Table 1. Multiple regression results for government healthcare financing in 2000–2020

Countries	Government Healthcare Financing to Government Budget		Government Healthcare Financing to Total Health Financing		Government Healthcare Financing to GDP		Government Healthcare Financing per Capita
	P-Value	Coefficient	P-Value	Coefficient	P-Value	Coefficient	P-Value	Coefficient
Russia	0.03**	1.41	0.00***	0.77	0.00***	−6.71	0.01**	−0.00
Saudi Arabia	0.07*	−2.67	0.01**	1.49	0.00***	−12.21	0.01**	0.02
UAE	0.04**	3.50	0.00***	0.45	0.00***	−17.51	0.00***	0.02
Iran	0.76	−0.25	0.56	0.21	0.49	−3.50	0.76	−0.01
Kuwait	0.43	1.76	0.89	−0.09	0.00***	−10.21	0.08*	0.01
Kazakhstan	0.25	1.41	0.01**	0.63	0.26	−6.62	0.00***	−0.07
Qatar	0.10*	2.31	0.00***	1.02	0.02**	−9.94	0.00***	−0.02
Angola	0.49	−2.72	0.03**	1.25	0.36	8.2	0.01**	−0.39
Algeria	0.02**	−1.24	0.00***	0.28	0.00***	−13.43	0.00***	0.15
Oman	0.78	0.75	0.08*	1.58	0.05**	−13.54	0.20	−0.01

Note: ***= significance at 1% level, **= significance at 5% level, *= significance at 10% level.

In SA and Algeria, a significant positive relationship was noted between government healthcare financing to total healthcare financing and oil investments (p = 0.01 and coefficient 1.49, and p = 0.00 and coefficient 0.28, respectively). Both countries also showed a positive relationship between government healthcare financing per-capita and oil investments (p = 0.01 and coefficient 0.02, and p = 0.00 and coefficient 0.15, respectively). On the other hand, government healthcare financing to government budget showed a significant negative relationship with oil investments (p = 0.07 and coefficient −2.67, and p = 0.02 and coefficient −1.24, respectively; see Table 1). Similarly, a significant relationship was found between government healthcare financing to GDP and oil investments (p = 0.00 and coefficient −12.21, and p = 0.00 and coefficient −13.43, respectively).

In Kuwait and Oman, government healthcare financing to GDP exhibited a significant negative relationship with oil investments (p = 0.00and coefficient −10.21, and p = 0.05 and coefficient −13.54, respectively). In addition, a significant positive relationship between government healthcare financing per-capita and oil investments was found in Kuwait (p = 0.08and coefficient 0.01), while a significant positive relationship between government healthcare financing to total healthcare financing and oil investments was found in Oman (p = 0.08and coefficient 1.58).

In Kazakhstan and Angola, government healthcare financing to total healthcare financing indicated a positive relationship with oil investments (p = 0.01 and coefficient 0.63, and p = 0.03 and coefficient 1.25, respectively). However, both countries displayed a significant negative relationship between government healthcare financing per-capita and oil investments (p = 0.00 and coefficient −0.07, and p = 0.01 and coefficient −0.39, respectively). Notably, these countries did not show any relationship between government healthcare financing to government budget or GDP and oil investments. Moreover, Iran was the only country that did not show relationship between any of the study variables and oil investments (see Table 1).

4. Discussion

Economic activities pose increasingly urgent challenges for CECC, making it essential to understand their impact on the environment. This study investigates the relationship between government healthcare financing and CECC in oil-producing countries, aiming to shed light of the implications on CECC. By investigating this intricate relationship, it delves into a previously unexplored territory. While the implications of economic activities on CECC have garnered increasing attention, no studies have specifically examined the novel combination of healthcare financing and CECC in the context of oil-producing nations. This study addresses this critical gap by focusing on countries with high oil production and the highest oil revenue to GDP, recognizing their significant influence on CECC. This study is one of the first attempts to quantitatively analyze this relationship to contribute a novel perspective to the existing literature.

The study results indicated positive relationships between government healthcare financing to total healthcare financing and oil investments in all countries except Iran and Kuwait. These findings suggest that countries relying heavily on oil for financing require greater oil investment when the government’s share of total healthcare financing increases; conversely, they require less oil investment when the share declines. This relationship suggests that the required change in the level of government healthcare financing impacts CECC accordingly. Such findings align with those of previous studies, which pointed to the consequent impact of the level of government financing (Fan et al., 2020), government economic growth expectations (Wang et al., 2021), financial development (Jin et al., 2022), and the change in different economic activities on CECC (Nasir et al., 2019).

On the other hand, a negative relationship was observed between government healthcare financing to GDP and oil investments in Russia, SA, the UAE, Kuwait, Qatar, Algeria, and Oman, which indicated lower oil investments with increasing government healthcare financing. This pattern could be prevalent among developing countries that heavily rely on oil for financing, such as OPEC+ countries. This occurs when countries require intensive financing over the years for setting their healthcare system infrastructure, where at a specific point in time, only minor changes to their government healthcare financing to GDP occur. Such finding suggests a lower impact on CECC over time with changes in government healthcare financing to GDP. As the increase in government healthcare financing to GDP has a direct link to economic growth, the observed relationship aligns with the environmental Kuznets curve hypothesis. This indicates that at the early stages of economic growth, pollution emissions increase where environment quality decreases, but over time and by reaching a specific level of income, economic growth leads to environmental improvement (Leal & Marques, 2022). This hypothesis has been tested in a substantial amount of research globally (Mahmood, 2023; Mahmood et al., 2023), including by the Gulf Cooperation Council region, which includes countries where this hypothesis was validated (Mahmood, 2022a). Through the model built for conducting this study, this outcome should take into consideration the fluctuating levels of oil productions after 2008 and 2015 (Al Mustanyir, 2023; The Global Economy, 2023a).

Relationships were also observed between government healthcare financing per-capita and oil investment in all countries except for Iran and Oman. Half of these relationships were positive, while the other half were negative. However, given their varying degrees, these relationships were all marginal, indicating that any increase or decrease to government healthcare financing per-capita would require only minor changes in oil investment (see Table 1). This suggest that changes to government healthcare financing per-capita could have small positive or negative effects on CECC. This finding also aligns with the environmental Kuznets curve hypothesis (Mahmood, 2020; Rok & Herbst, 2023), which suggests that at some point in time, a change in the level of government healthcare financing might increase or decrease CECC, albeit at lower levels.

In addition, a few countries showed relationships between government healthcare financing to government budget and oil investment. Significant positive relationships were observed for Russia, the UAE, and Qatar, which indicates that an increase in government healthcare financing to government budget would require higher oil investment, and a decrease in financing would require lower investment. Similar relationships were observed for SA and Algeria, but they were significantly negative, representing contrary trends. Some of these findings align with previous studies, which linked government financing and economic growth with the increase in CECC (Le & Ozturk, 2020; Samah et al., 2020), as in the case of Russia, the UAE, and Qatar but not SA and Algeria. Nevertheless, some studies have highlighted that public financing reduces emission in higher and middle-income countries, which confirms the findings for SA and Algeria but not those for Russia, the UAE, and Qatar (Canh et al., 2019). Such divergent results could be attributable to the investigated variable, the level of government total budget, type of healthcare system and priorities, level of oil production, and other reasons.

The results showed no relationship between the majority variables with oil investments in Iran, Kazakhstan, and Angola. Given these countries’ high investment in oil, they have very low government healthcare financial indicators, which were the lowest among the investigated countries, except for government healthcare financing to government budget in Iran and Kazakhstan (World Health Organization, 2023c). Such absent relationships could be attributed to the high portion of private healthcare financing in their systems, with Iran and Angola privately financing their healthcare systems at varying levels between 50% and 60% and Kazakhstan at a lower level. It is also worth highlighting that the varying degrees of relationships between governments healthcare financing and oil investments among all the investigated countries depends on the nature of each variable and what exactly it measures, along with the countries’ different economic and healthcare system components.

The study provided comprehensive evidence on the relationship between government healthcare financing and oil investment. Such relationships suggest that government healthcare financing contribute to CECC, as evidenced by the positive relationships in most of the investigated countries and variables. Countries that showed negative, marginal negative, or no relationships in some variables could have positive relationships at some point in the future if they maintained high levels of oil investment with a significant portion of their healthcare systems financed publicly. This situation could be inevitable given the world’s changeable healthcare needs (Jakovljevic et al., 2022), which might require more investment in healthcare and its infrastructure and thus make these countries substantial and persistent contributors to CECC.

In some cases, the high government healthcare financing could not be attributed to an actual need or development in the healthcare system as much as to the system’s regulations. For example, maintaining overlapped healthcare eligibility standards could yield a large portion of the population more than one free access to different healthcare provisions, as in the case of high-income countries such as SA and Kuwait (Al Mustanyir et al., 2022; International Trade Administration, 2022b). The unnecessary or complementary options could encourage these countries to increase oil investments to allow the government to finance these options, which could affect CECC unnecessarily.

Given the instability of oil prices, their sensitivity to market changes, and the economic uncertainty oil creates (Bayati & Bin Al-Hamid, 2022; Bouri et al., 2020; Onour & Abdo, 2022), many oil-dependent countries have perused financing alternatives to oil. This decision was further encouraged by the recognition of renewable energy as a more sustainable alternative (Al-Maamary et al., 2017; Murshed & Tanha, 2021), and the global transformation toward net-zero emissions (International Energy Agency, 2022; Murshed & Tanha, 2021). Therefore, many countries in this study have set economic plans to diversify their governments resources and transform healthcare systems. These include Qatar (Ministry of Health, 2018; Mishrif, 2018), Oman (Al Naimi, 2022; Ministry of Health, 2014), the UAE (Ministry of Foreign Affairs, 2023; Mishrif, 2018), SA (Chowdhury et al., 2021; Mishrif, 2018), Kuwait (Al Naimi, 2022; Alnashmi et al., 2022; Salman et al., 2000), Russia and Kazakhstan (Yasmin et al., 2020), Iran (Doshmangir et al., 2019; Harirchi et al., 2020), Algeria (Oxford Business Group, 2017), and Angola (Vats, 2022). However, given the relationships between government healthcare financing and oil investments observed in this study, the shift from oil dependency may still be in its early stages in these countries. This could be attributed to the strategies for resources diversification and the prioritization given to improving some healthcare indicators rather than shifting government healthcare financing from oil dependency, which keeps these countries as substantial contributors to CECC.

The reduction of carbon emission, the race against climate change, and the accelerating progress toward global net-zero emission transformation require the governments of OPEC+ countries to consider alternative healthcare financing mechanisms, as opposed to excessive reliance on government finances that mainly rely on oil investments. It is also necessary to avoid transitioning to healthcare financing models that would require privatizing the system owing to the long time that such a shift would require. This is attributed to the large size of the public healthcare system in general, which could not be accomplished by domestic investors but would require large FDI, and therefore, could take longer time to be realized, thereby potentially impeding the global net-zero emission transformation.

The findings of this study have important policy implications for healthcare and the environment. The empirical evidence derived from multiple regression analysis offers valuable insights for policymakers in formulating effective strategies to address the complex challenges posed by government healthcare financing to CECC. First, the study highlights the importance of perusing healthcare financing alternatives to oil as a crucial step toward relieving the damages posed to CECC. Policymakers can utilize this outcome to allocate resources more strategically and enhance healthcare infrastructure and services to cope with changeable healthcare needs, while protecting environmental conditions. Second, the study underscores the need for climate-conscious healthcare planning. Integrating climate considerations into healthcare policies can help reduce the healthcare financing footprint on CECC while ensuring a more resilient and adaptive healthcare system. Furthermore, the study’s focus on OPEC+ countries emphasizes the environmental responsibilities and opportunities for similar nations. Policymakers can use this evidence to advocate for greener financing and cleaner energy alternatives, promoting a transition toward low-carbon economies and simultaneously improving healthcare performance while mitigating the impacts on CECC. Ultimately, the policy implications derived from this study contribute to a comprehensive approach that integrates climate change considerations into healthcare planning and highlights the role of sustainable policies in promoting both human health and environmental well-being.

The study acknowledges certain limitations. The exclusion of some highly polluting countries such as China, the United States, and the European Union from the analysis could potentially impact the broader applicability of the results. Notably, the pollution generated from these countries is predominantly attributed to manufacturing activities rather than oil production. As a result, the study’s focus on oil-producing nations may not fully capture the complexities of CECC implications arising from diverse pollution sources. To address this limitation and enhance the comprehensiveness of future research, it is suggested that future studies adopt a broader scope, encompassing a more diverse range of countries with varying pollution profiles. By including nations known for substantial manufacturing emissions alongside oil-producing countries, researchers can gain a more holistic understanding of the intricate interactions between government healthcare financing and climate change on a global scale.

5. Conclusion

This study investigated whether government healthcare financing contributes to CECC by examining the relationship between government healthcare financing and oil investment among OPEC+ counties. Despite varying levels of relationships among the investigated countries and variables, the majority indicated to significant contribution to CECC.

Maintaining diversification strategies, which require a longer period to realize the shift from oil dependency, and adopting healthcare transformations that prioritize healthcare aspects other than financing may perpetuate OPEC+’s investment in oil. Considering global population growth, aging, the prevalence of communicable and non-communicable diseases, and pandemic mutations, the publicly financed healthcare systems would need more oil investment. This is especially true given the volatile oil market, which governments rely on to meet their obligations to the systems. Unless this dependence is reversed, it could inevitably deteriorate environmental quality in the long run.

The results of this study suggest that OPEC+ and oil-dependent countries to liberate their healthcare systems from oil dependence, particularly considering the environmental damage caused by oil investment. The study encourages these nations to increase bolstering their healthcare financing resources by relying more on green financing and to utilize transformation strategies that accelerate the pace toward global net-zero emissions. Further, the study suggests conducting additional investigations into the applicability of alternative healthcare financing mechanisms, such as Medical Saving Accounts and Private Health Insurance, on healthcare systems that are financed similarly to those in OPEC+ countries. It also encourages to conduct similar investigations as those in this study but with a broader scope, including more countries with different pollution profiles.

Highlights

• Oil-dependent countries boost oil investments to meet global healthcare demands, which could negatively affect carbon emissions and climate change.

• The relationship between government healthcare financing and oil investment in OPEC+ countries was investigated.

• Most countries and variables showed associations between government healthcare financing and oil investment.

• OPEC+ appeared to significantly contribute to carbon emissions and climate change.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Data availability statement

All data have been included in this manuscript, and more data can be found in the Global Health Expenditure Database of the World Health Organization. Any additional data can be provided upon request.

Public interest statement

This study investigates the relationship between government healthcare financing and carbon emissions and climate change in OPEC+ countries. Multiple regression analysis was conducted on quantitative data covering the 2000–2020 period and extracted from the WHO and Global Economy databases. Government healthcare financing to total healthcare financing, GDP, and per-capita showed a significant relationship with oil investment among most of the countries included. This oil dependence makes these countries persistent contributors to carbon emissions and climate change. This study urges to utilize different sources of financing and adopt transformative strategies to expedite the transition to net-zero carbon emissions.

Additional information

Funding

This work did not receive any external funding.

Notes on contributors

Salem Al Mustanyir

Dr. Salem Al Mustanyir, senior economist and business intelligence expert, with previous experience in different companies, universities, and public organizations at national and international levels at departments of research, strategy, accounting, finance, investment, insurance and risk management. Dr. Al Mustanyir research activities focus on health economics, financing, policy impact assessment, economic of data, energy and labor market, smart cities, investment in artificial intelligence, and building public and private performance indices.