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Archaeology indicates that Cagayan has been inhabited for half a million years, though no human remains of any such antiquity have yet appeared. The earliest inhabitants are the Agta, or Atta, food-gatherers who roam the forests without fixed abodes. A large tract of land has lately been returned to them. The bulk of the population are of Malay origin. For centuries before the coming of the Spanish, the inhabitants traded with Indians, Malays, Chinese, and Japanese. In the nineteenth century the prosperity found in tobacco cultivation caused many Ilokano to settle here. Tobacco is still a major factor in the economy of Cagayan, though a special economic zone and free port has been created to strengthen and diversify the provincial economy.
During Spanish times Cagayan Valley had a larger territory than what it has today. It included the territories of the above-mentioned provinces and the eastern parts of the Cordillera provinces of Apayao, Kalinga, Ifugao and Benguet. As the historian and missionary Jose Burgues, said, "The old Cagayan Valley comprises the province of Cagayan, Isabela and Nueva Vizcaya as well as the military Districts of Apayao, Itaves, Quiangan, Cayapa and Bintangan, plus the area of the Sierra Madre to the Pacific Ocean in the said trajectory."
During World War II at Balete Pass in Nueva Vizcaya, the retreating Japanese under General Tomoyuki Yamashita dug in and held on for three months against the American and Filipino forces who eventually drove them out; the pass is now called Dalton Pass in honor of General Dalton, USA, who was killed in the fighting.
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