Originally from Marsabit, Kenya, Kathleen Hirkento McPeak came to Watson's MPA program after earning her bachelor's degree in policy studies from Syracuse University. She was awarded a fellowship to work with CHRHS' Chernoh Bah and Director of the Africa Initiative Daniel Jordan Smith on how illicit financial flows shaped an electricity privatization project in Freetown, Sierra Leone.
McPeak said the key question the research team addressed was, "How did illicit financial flows during the privatization of electricity in Freetown, Sierra Leone, affect the success of electricity availability?" And said the big takeaway of the research project was that “The process of privatization led to flawed implementation, which enabled illicit financial flows that ultimately compromised development outcomes.”
McPeak's role in the project was to help define the research question, undertake a literature review, develop the research methodology, and collect and analyze data.
McPeak said she used "a mixed-methods approach," utilizing a wide variety of sources in her research. "I analyzed IMF reports, World Bank audits, national legislation and financial agreements, just to name a few," she said. She also conducted interviews with key stakeholders. "One of the most telling insights came from a respondent who revealed that companies with no financial capacity were awarded contracts through insider deals," said McPeak, “a clear sign of corruption and financial manipulation within the privatization process.”
McPeak found key structural and legal failures throughout the entire process. "The privatization process was illegal from the start," she said. "Contracts were awarded before the Electricity Act of 2011 was even passed, violating competitive bidding laws." She found little oversight, with key institutions having been dismantled in advance of the project. "Later amendments were used to cover up these illegal actions, further weakening legal accountability," she said.
Not all of the problems originated in Sierra Leone. "Debt relief came with conditions — the IMF and World Bank pushed Sierra Leone to prioritize economic efficiency over human development," she said. This led to policies that focused on GDP growth while neglecting quality-of-life indicators, and the promised infrastructure improvements "never materialized," she said. McPeak noted that Sierra Leone's Human Development Index (HDI) dropped from 169th out of 193 countries in 2002 to 184th as of 2022.
At the same time, she said, electricity costs skyrocketed from under $200 million to over $1 billion, deepening the country's financial burden," and “Energy shortages and unreliable electricity still affect millions of Sierra Leoneans today.”
McPeak said, "This case shows the dangers of externally imposed development policies. Without transparency and strong institutions, privatization leads to corruption, inefficiency, and unmet development goals." She noted that while the illicit financial flows were traced internationally, no meaningful actions were undertaken to prevent them.
"International organizations are complicit," said McPeak, "Not only did they prioritize economic liberalization over human welfare. They pushed a privatization model that failed to deliver on affordability, accessibility or availability of electricity." She said that future models must prioritize human development, strengthen oversight, and ensure transparency in financial flows to deliver tangible benefits.
Currently, McPeak said she is "in the writing and review phase" of the project. She said she will continue her research during the spring semester and plans to “compare privatization models across different nations in Africa [and] track transnational financial flows in a similar project.”
McPeak found the program a rewarding learning experience. "This project helped me understand the intricacies of development and aided in my ability to identify why and how these projects fail," she said. "Beyond that, as someone who aspires to have a career working for and with low/middle-income nations on development projects, I not only understand failures but can diagnose weaknesses and conceptualize successful projects in the future."
Africa Initiative Director Daniel Jordan Smith noted that working under the supervision of Postdoctoral Research Associate Chernoh Bah, "Katie proved a quick study, learning how to track down sources, analyze their meaning and consequences, and follow up with individual actors located at multiple points in the networks that underlie these activities."