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I've seen this term thrown around on Lemmy in different contexts, so I looked it up and the wikipedia page gives a very specific definition of that term relating to a type of economic situation. I don't think that particular definition applies in this case, or does it?
It's less the economic definition than it is this:
https://www.dictionary.com/browse/banana-republic
noun - Usually Disparaging.
a small, poor country, often reliant on a single export or limited resource, governed by an authoritarian regime and characterized by corruption and economic exploitation by foreign corporations conspiring with local government officials.
any exploitative government that functions poorly for its citizenry while disproportionately benefiting a corrupt elite group or individual.