The country, Ethiopia, has passed through centrally command economy wherernresources are mainly produced and allocated (at least conceptually) by therngovernment. Particularly the fixed exchange control system pursued by the formerrngovernment had a lot of pressure on the economy. Among these the increasinglyrnimportant share of the black market is one. However, by year 1992 the TransitionalrnGovernment of Ethiopia (TGE) had took Economic Reform Program. The domesticrncurrency has devalued and further measures are taken that result to depreciationrnof the birr and reduction of the exchange rate premium. An econometric model,rnError Correction Model, is employed to empirically investigate the adjustment ofrnmajor agricultural exports of the country to currency depreciation in the presence ofrnparallel market. Time-series data (from year 1974-2003) of GOP, parallel exchangernrate, official exchange rate, volume and value of major agricultural exports, andrnCPI are used. The empirical result suggests that exchange rate depreciation thatrnerodes the parallel market premium has significant impact in export performance.rnThe insignificant coefficient of official exchange rate and the significant (negative)rncoefficient of the premium together tells us that the improvement in exportrnperformance was due to the switch of trade from illicit to official channel implyingrnthe black market has important share in the country's export. The econometricrnresult also suggests that there is inefficiency in resource utilization. Generally, thernpervasiveness of structural rigidities in developing countries, as explained byrnstructuralisms that need to be tackled to improve the export performance isrnemphasized. Therefore, the implication is that complementary measures need tornbe taken along with the devaluation of the currency in order this measure havernsignificant and positive impact on the country's agricultural export.