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This report constitutes the first agricultural policy review undertaken by the MAFAP project in Kenya. The report reviews the main developments of the economy and the agricultural sector as well as the main policy decisions affecting this sector. However, its main contribution focuses on: a) an analysis of price incentives and disincentives faced by farmers and consumers for ten agricultural commodities, which cover a significant share of agricultural production, imports, exports and diet; and b) a detailed analysis of the composition and level of public expenditure in support of agriculture and rural development. The former analysis was made for the period 2005-2010, while the latter covers 2006 to 2011.