California has officially surpassed Japan to become the fourth-largest economy in the world. Governor Gavin Newsom announced this milestone on Wednesday, citing data from the International Monetary Fund (IMF) and the US Bureau of Economic Analysis (BEA). With a nominal GDP of $4.1 trillion, California now trails only the United States, China, and Germany.
The state’s economy has seen impressive growth, with a 6% increase in 2024, outpacing major global economies like the US (5.3%), China (2.6%), and Germany (2.9%). California’s average GDP growth rate over the past four years has been 7.5%, solidifying its position as an economic leader.
Governor Newsom attributed the state’s economic success to its policies focused on sustainability, innovation, and investment in people. He emphasized that California isn’t just keeping up with the world but leading it. The state is a driving force in sectors such as manufacturing, high technology, and agriculture, as well as being a leader in new business startups and venture capital funding.
Tourism also plays a significant role in California’s economy, with record-high spending contributing to growth. The state’s economic strength is reflected in its federal contributions, where California sends over $83 billion more than it receives. However, Newsom has challenged federal tariff policies, arguing they are hurting businesses and consumers and threatening the state’s progress.