This study investigates the direct impact of financial repression on economic growth in the Central African Economic and Monetary Community (CEMAC) and the West African Economic and Monetary Union (UEMOA) using a lagged composite repression index and panel fixed-effects regressions. Contrary to theoretical expectations, lagged repression exhibits a significantly positive association with GDP growth in the main model, with robustness checks confirming no negative direct effect. The findings suggest that in pegged currency unions, repression may support growth through public channels or forced savings, offsetting private crowding-out, while capital formation remains a key driver. This effect, contrasting with repression’s negative impact on investment, highlights union-specific resilience and calls for calibrated reforms to balance stability with deepening.
Amirreza Kazemikhasragh (2026) studied this question.